Baroness Howarth of Breckland

Valerie Georgina Howarth, OBE, having been created Baroness Howarth of Breckland, of Parson Cross in the County of South Yorkshire, for life--Was, in her robes, introduced between the Lord Haslam and the Baroness Scotland of Asthal.

Lord Ashdown of Norton-sub-Hamdon

The Right Honourable Sir Jeremy John Durham Ashdown, KBE, having been created Baron Ashdown of Norton-sub-Hamdon, of Norton-sub-Hamdon in the County of Somerset, for life--Was, in his robes, introduced between the Lord Jenkins of Hillhead and the Lord Holme of Cheltenham.

Democratic Republic of Congo: National Reconciliation

The Earl of Sandwich: asked Her Majesty's Government:
	What progress they have made in furthering national reconciliation in the Democratic Republic of Congo.

Baroness Amos: My Lords, with our African, EU and UN partners, we continue to support the Lusaka peace agreement as the basis for ending the conflict in the DRC, promoting national reconciliation and stability in Central Africa. We also continue to urge all parties involved in the conflict to engage in a dialogue to build confidence and remove mistrust. Our support for the inter- Congolese dialogue facilitator is a major contribution welcomed by all.

The Earl of Sandwich: My Lords, I thank the Minister for that reply. Does she agree that the Congo has improved its international relations considerably during the past few months but that internally much more progress needs to be made on human rights, national reconciliation and political dialogue? Can the noble Baroness speculate as to whether the Congo will follow the South African model, which has proved so successful? What precisely will be the role of aid donors, including Belgium, which is promising aid, and the United Kingdom?

Baroness Amos: My Lords, we recognise and welcome the steps taken by the Government of the DRC to improve, in particular, the economic situation of that country. I agree with the noble Earl that a good deal of work still needs to be done, including work in the area of political dialogue. Given the current ongoing discussions, it would be inappropriate to speculate on the future of the DRC at this point in time.
	As to the noble Earl's question about the role of aid donors, he will be aware that the Belgian Prime Minister, Foreign Minister and Development Minister visited the DRC recently and made a commitment in terms of aid funding. We are working with our international partners, including the international financial institutions, to see what would be most appropriate in the current context.

Baroness Rawlings: My Lords, in March, the EU Council of Ministers agreed provisionally to grant the DRC 120 million euros--more than 100 million dollars--for spending on health, roads, education and justice. Commissioner Nielson has indicated that the release of those funds would be conditional on progress with an inter-Congolese dialogue and that some of the funds would be earmarked for the reintegration of armed groups in eastern DRC. What plans do Her Majesty's Government have for releasing funds to the DRC, and how much is being earmarked for reintegration purposes?

Baroness Amos: My Lords, we provided over £3.3 million in humanitarian assistance to the DRC last year in a variety of areas, including work with refugees and child soldiers, and in the area of human rights. That budget will increase substantially this year, because we have access to more areas in the DRC. With regard to the European Union, Commissioner Nielson is to visit the DRC shortly. We are concerned to see a continuation of the inter-Congolese dialogue.

Lord Judd: My Lords, in adopting their sensibly measured approach, will the Government give priority to the strengthening of civil society and to the building up of the judicial system and the administration of justice in that country, which are so essential to making the pursuit of human rights meaningful?

Baroness Amos: My Lords, in the work that we are doing in sub-Saharan Africa--not only in the Great Lakes region--focusing attention on building civil society, examining judicial systems and working with government to put in place good governance processes that will facilitate transparency and accountability continue to be a priority and will be a priority in whatever work we decide to do in the DRC in future. It is important to understand that we are at a critical and sensitive stage in terms of discussions within the DRC. Those kinds of decisions are not being made now, but they will be made in the longer term.

Lord Avebury: My Lords, is not Commissioner Nielson in the DRC at the moment, and has he not sought assurances from the RCD that it will move towards unity as a condition of releasing the EU funds? What guarantees of unity could the RCD give; and would similar guarantees be sought from Jean-Pierre Bemba of the FLC? What liaison is there between M. Nielson and the UN Special Envoy, Roberto Garreton, who is also on a two-week mission to the DRC?

Baroness Amos: My Lords, we have tried to ensure good liaison between all the different parties engaged in the attempt to resolve the conflict in the DRC. We have worked hard to ensure that the European Union, the UN and individual actors in terms of countries with an interest in the DRC liaise well with each other. I am unable at this stage to set out what we shall seek from the different parties. We have supported the Lusaka peace agreement from the outset. We continue to believe that it is the only viable solution to the conflict in the DRC. We shall continue to use that process and to engage in dialogue with the different parties involved. But I cannot say at this stage what conditions the parties will want to put in place.

Baroness Gardner of Parkes: My Lords, when Hansard is printed, will all the initials used by the previous speaker be translated into a form that the House can understand?

Baroness Amos: My Lords, we shall do our best--although I cannot guarantee that we can translate them into Australian!

Baroness Williams of Crosby: My Lords, does the Minister agree that a crucial key to peace in the Congo is the ability to control the diamond trade? Have any advances been made to bring the DRC within the same kind of framework as is applied to Sierra Leone and which already exists, and is extremely successful, in Botswana?

Baroness Amos: My Lords, we attach great importance to the need for international action to tackle the issue of conflict diamonds and the other resources that are used for exploitation within the DRC. As regards conflict diamonds, the Kimberley process is making real progress in devising an international scheme which we hope will address part of the problem. We look forward to further progress in agreeing the various details of the scheme at the next meeting, which will take place in London in mid-September.

Residential Homes: Spiritual Care

The Lord Bishop of Rochester: asked Her Majesty's Government:
	In the light of their commitment to the provision of spiritual care in the National Health Service, what arrangements are there for the provision of such care in privately run residential institutions for people who are mentally ill or have learning difficulties.
	The Parliamentary Under-Secretary of State, Department of Health (Lord Hunt of Kings Heath):
	My Lords, an essential principle of care homes has always been residents' rights of choice, including in matters of religion. The new national minimum standards will make residents' right to exercise choice more explicit. The draft care homes regulations include a requirement that, so far as is practicable, residents should have the opportunity to attend the religious services of their choice.

The Lord Bishop of Rochester: My Lords, I thank the Minister for that reply. Is it possible for the health service or local authorities to write a requirement for the provision of spiritual care into the contracts of the private companies that provide the care?

Lord Hunt of Kings Heath: My Lords, the right reverend Prelate raises an interesting point. I shall be glad to arrange discussions between the department and the Church authorities on the matter. My understanding is that access to spiritual care will come about because of the standards laid down by the National Care Standards Commission; the commission will then be able to monitor those standards. What is not in doubt is that we share the right reverend Prelate's concern to make sure that spiritual guidance and activities are available to such residents.

Lord Astor of Hever: My Lords, in view of the loss of 11,000 care beds last year, with all the human tragedy that that causes, does the Minister agree that it is especially important that the mentally ill and those with learning difficulties receive spiritual care?

Lord Hunt of Kings Heath: My Lords, I have already said that spiritual care is important for those residents who desire it. I also accept that, as in the National Health Service, residents in care homes and nursing homes should be provided with spiritual care when they so desire. As regards the loss of care places, presently there remains a surplus of places over demand.

Lord Patel of Blackburn: My Lords, when we have a commitment as regards the provision of spiritual care, does my noble friend the Minister agree that it must also cover all other faiths?

Lord Hunt of Kings Heath: Yes, my Lords. I agree with my noble friend. The National Care Standards Commission will ensure that the needs and preferences of specific minority ethnic communities, and of social and cultural or religious groups, will be catered for, understood and met.

Baroness Barker: My Lords, given the Minister's replies, can he say what efforts the Government will be making to ensure that care staff are trained to recognise and meet the spiritual needs of people in residential homes?

Lord Hunt of Kings Heath: My Lords, much needs to be done in relation to the workforce in the care sector. Discussions are taking place between the relevant organisations, including representatives of home owners, local authorities and the Department of Health, to ensure that we do provide an infrastructure that enables the appropriate training to be given. I should also point out to the noble Baroness that, because spiritual care will be one measure by which individual homes will be judged by the National Care Standards Commission, the dialogue that will ensue from that process will also encourage the training of staff to recognise and provide the needs to which she referred.

Baroness Knight of Collingtree: My Lords, perhaps I may invite the Minister to pay tribute to the hundreds, if not thousands, of such homes run by nuns and Roman Catholics. Is he aware that the standard of care is of quite rare and wonderful quality, as regards both loving care and spiritual care? Is the Minister also aware of a home called the Little Sisters of the Poor at Harborne in Edgbaston in my old constituency, which he knew well? Therefore, will the noble Lord pay tribute to the wonderful spiritual care that these people provide?

Lord Hunt of Kings Heath: My Lords, I am very happy to do so. I should also point out that there are other faiths in the city of Birmingham that provide such care. I have in mind, for example, the Jewish care homes run by Andrew Cohen House, which provide extremely excellent services. The whole purpose of the National Care Standards Commission is to try to ensure that the excellence that we find in many homes is spread throughout the sector. We also owe a debt to chaplains in our NHS hospitals, who carry out a magnificent job. We are very glad to support that effort.

Lord Clement-Jones: My Lords, can the Minister tell the House what lessons he draws from the recent report from the Sainsbury's Centre for Mental Health entitled, Forward in Faith, which put forward a number of very interesting ideas--in particular, the suggestion that there should be an initial spiritual care assessment at the beginning for mental health service users?

Lord Hunt of Kings Heath: My Lords, we shall of course consider those recommendations, as we would consider any recommendations coming from the Sainsbury's Centre for Mental Health. I certainly believe that a balance has to be struck here: on the one hand, one needs to ensure that residents are given every opportunity to receive spiritual support when they require it; but, on the other hand, one wishes to ensure that it is an option for which people volunteer, rather than having this forced upon them. As long as we can maintain that balance, we should be most interested in considering the matter further.

University Access: Financial Barriers

Lord Faulkner of Worcester: My Lords, I beg leave to ask the Question standing in my name on the Order Paper. In doing so, I declare an interest as chairman of the appeal of Worcester College, Oxford.
	The Question was as follows:
	To ask Her Majesty's Government what discussions they have had with the University of Oxford about removing financial barriers which might deter bright students from applying for a place.

Baroness Ashton of Upholland: My Lords, removing barriers to study for the brightest students is an important priority for the Government. Our £190 million "Excellence Challenge" programme is designed to address the under-representation of students from disadvantaged backgrounds in higher education. Within this, we have set aside £36 million over the next three years to award 25,000 opportunity bursaries. I welcome the steps that Oxford University has taken to widen access, including the recent launch of its new bursar scheme.

Lord Faulkner of Worcester: My Lords, I thank my noble friend the Minister for that reply. I welcome the support that she gives to the new bursary scheme that the university will be introducing in October next year. Is my noble friend aware that the proportion of students from maintained schools who won places at Oxford this years has now risen to 55 per cent, compared to 48 per cent 10 years ago? Is she also aware that the standards of academic attainment that these students are achieving is higher than it has ever been? Further, will my noble friend support the university's efforts to reach out to schools all over the country in the state sector, encouraging pupils to apply, and will she endorse the vice-chancellor's statement that there has never been a better time to apply to Oxford?

Baroness Ashton of Upholland: My Lords, the statement of the vice-chancellor, Colin Lucas, was welcomed by my right honourable friend the Secretary of State. I should pay tribute to what Oxford is seeking to achieve. In so doing, I recognise the work that it has carried out with summer schools this year which was funded by both the HEFC and the Sutton Trust, as well as the links that have been made with local education authorities and schools, including six east London boroughs and numerous other links made through the "Excellence Challenge" programme. There are also visits to schools and those from schools. The university has been working with other teachers, especially during the Sutton Trust teachers' in-service week, and there is also student mentoring and tutoring at state schools. I believe that all those efforts contribute to the increasing numbers of students entering Oxford from state schools.

Earl Russell: My Lords, is the Minister aware that financial barriers are not confined to the personal circumstances of the applicant? Is she further aware that university teachers--I declare an interest as one--frequently have to attempt to assess the ability of people who know nothing of the subject that they are supposed to have studied, except what the teacher has told them? Does the noble Baroness understand that this is as difficult as assessing the political ability of someone who has read nothing on the subject save a Millbank briefing? Does she further agree that putting this right is the responsibility of government, not of universities?

Baroness Ashton of Upholland: Oh for a Millbank briefing, my Lords! As always, the noble Earl makes an incredibly important point. By making that slight joke, I would not wish to disparage what he says. I know that my honourable friend Margaret Hodge, who has responsibility for this area, is looking into the matter. Perhaps I may pass on the noble Earl's comments to her with the request that she contacts him directly.

Baroness Perry of Southwark: My Lords, I join with the Minister in commending Oxford on the excellent work that it has carried out in this respect. However, would the noble Baroness like also to commend Cambridge on its bursary scheme, which was actually introduced in 1988 and which will next year provide for students in hardship to receive up to £1,000 provided that they qualify for fee remission from their LEAs? Further, does the Minister share my dismay that universities are now having to spend so much of their money providing for student hardship created by the removal of the maintenance grant by this Government, and by the introduction of university fees?

Baroness Ashton of Upholland: My Lords, I commend Cambridge, and other universities, which are accomplishing great work in terms of developing their admission policies and bringing in young people. As the noble Baroness will know, we have a target of 50 per cent as regards getting young people through higher education by the time they reach the age of 30. That is a target that we should all acclaim.
	As to student hardship, the noble Baroness will appreciate that we are looking constantly at the balance between the needs of students, families and taxpayers. There is no evidence to suggest that the number of students applying from different backgrounds is falling. However, that does not mean that we are complacent because we are also looking to increase the number of students who apply. We are always looking at the arrangements that we have in place, but we have tried to balance these arrangements. As the noble Baroness will know, tuition fees are not paid by 50 per cent of students. There are access and hardship funds to the value of £93 million available at present, which is four times the amount available in 1997. For mature students and student parents, we have specific grants, bursaries and new childcare grants, the total of which can amount to as much as £17,425.

Lord Butler of Brockwell: My Lords, in declaring an interest as head of an Oxford college, can I ask the Minister whether she is aware that it is a commonly held but false belief that it is more expensive for a student to attend Oxford--or, indeed, Cambridge--than other universities? Will the Government do their utmost to help both Oxford and Cambridge counter that belief, which may well discourage students from poorer backgrounds applying to those universities?

Baroness Ashton of Upholland: My Lords, we should be very happy to counter that belief. However, there is an additional issue; namely, the concern that schools do not perhaps recommend to their students that they might apply to Oxford and Cambridge. We still have many barriers to break down in terms of the assumption that Cambridge and Oxford are only for pupils of certain schools and for certain kinds of students. To me, that seems to be a much more crucial barrier and one that we must consider. We know that some schools simply do not recommend that approach; that students do not aspire to it; and, indeed, that their backgrounds are not such as immediately to lead them to consider either Oxford or Cambridge. We need to do much more in this respect. That is why the outreach work from Oxford, Cambridge and other universities is of vital importance.

Baroness Lockwood: My Lords, does my noble friend the Minister agree that many universities have been innovative in trying to recruit students from social groups which do not normally think in terms of university education? The University of Bradford, for instance--and I declare an interest as its Chancellor--pioneered summer and Saturday morning university places directed largely at ethnic groups within its local community. Does my noble friend also agree that such activities put an additional strain on universities, both financially and in terms of manpower? Will that factor be taken into consideration in the next financial round?

Baroness Ashton of Upholland: My Lords, I again pay tribute to Bradford, Nottingham, Warwick, Oxford, Cambridge, Bristol, York and Sussex universities. As noble Lords and I have mentioned, some extremely innovative practices are taking place. I stress that they are not about lowering the requirements of students; they are about looking more broadly at applicants, their abilities and their achievement potential.
	As I mentioned to the House on another occasion, research is beginning to suggest to us that the young people who come to university with similar A-levels, but from schools which have traditionally had lower levels of achievement, do better than their counterparts. That is an interesting subject that I know noble Lords will want to hear more about. "Excellence Challenge" is part of our thinking about how to support universities and we will keep the matter under review.

Lord Renfrew of Kaimsthorn: My Lords, with reference to the Minister's remarks about access to Oxford, would she not concede that her right honourable friend the Chancellor of the Exchequer did great disservice in that regard with his remarks about Laura Spence?

Baroness Ashton of Upholland: My Lords, on the previous occasion I replied by saying that my right honourable friend the Chancellor raised an interesting debate. I stand by that reply.

Coal-mine Methane

Lord Jenkin of Roding: asked Her Majesty's Government:
	Whether they intend to introduce legislation to give a specific exemption from the climate change levy for coal-mine methane used to generate electricity for distribution on the National Grid.

Lord McIntosh of Haringey: My Lords, for both environmental and commercial reasons, the Government support the utilisation of coal-mine methane for electricity generation and are currently examining a number of ways in which assistance can be given to the industry. We are at present discussing the treatment under the climate change levy of electricity generated from coal-mine methane with the Association of Coal Mine Methane Operators and we have asked that they provide further details of the case for an exemption.

Lord Jenkin of Roding: My Lords, the Government have accepted the fact, and the Minister has repeated it, that coal-mine methane is a dangerous gas; that it is 20 times more damaging to the environment than CO2, with which the recent Kyoto conference dealt; and that if the industry is to exploit the gas, trap it and use it, it must be given practical encouragement. Why is it taking so long for the Government to make up their mind how to give that encouragement?

Lord McIntosh of Haringey: My Lords, it is not a question of the Government making up their mind how to give that encouragement. There are certain constraints. Strictly speaking, coal-mine methane is not renewable and therefore it does not benefit from inclusion under the renewables directive. There is always the danger that help for coal-mine methane being used for electricity generation will be categorised as state aid. Although we hope to overcome that danger, we cannot be sure of doing so.
	Those are not simple problems. It is clear that coal-mine methane is a good product. It would be unfortunate, to say the least, if the non-renewable tag were to hold it back. However, we must operate within the law.

Lord Hardy of Wath: My Lords, my noble friend appears to be telling us that the Government are moving manfully towards consistency and doing so to the advantage of the environment and the economy. Is it not particularly important that the coal-field areas are allowed to enjoy the advantage which will follow a favourable decision and will that not greatly help to achieve the Kyoto targets, which need more serious consideration?

Lord McIntosh of Haringey: My Lords, as regards the coal-mining areas, coal-mine methane sold directly to end users as burner tip fuel is already exempt from the climate change levy. However, that does not mean that we need not seek wider exemption. We are looking, for example, at the Community guidelines on state aid for environmental protection to see whether it is a way around the problem that we face.

Lord Ezra: My Lords, following the question asked by the noble Lord, Lord Hardy of Wath, in regard to coal-field areas, while the various issues to which the Minister has referred are being sorted out, could not additional financial assistance be put into the coal-field areas to resolve the problem relating to this issue? That would at one stroke provide additional employment for unemployed mineworkers and contribute to the environment.

Lord McIntosh of Haringey: My Lords, the noble Lord, Lord Ezra, has rightly opened up the Question; from the difficulties relating to coal-mine methane to the wider issue of helping former coal-mining areas. I agree with everything he says and a wide range of programmes is directed towards that objective. A particular environmental problem is that if we do not tap the abandoned mines for coal-mine methane it will escape into the atmosphere. As the noble Lord, Lord Jenkin, said, that is 21 times more dangerous than the release of CO2.

Baroness Miller of Hendon: My Lords, does the Minister recall that when I drew attention to the German legislation which provided for the beneficial use of this potent gas in electricity production his noble friend Lord Sainsbury described what the Germans were doing as illogical and stupid?
	Leaving aside the question of whether that gracious reply prompted the Foreign Office to invite his noble friend to join the Diplomatic Service, will the Minister say what response he had from his German counterpart and what efforts his department has made to monitor the economic and ecological benefits of what has taken place in Germany? The noble Lord shakes his head. I am very surprised because it is a very simple question.

Lord McIntosh of Haringey: My Lords, it is a very complicated question because the noble Baroness, Lady Miller, is asking me to say what reply has been received from Germany to a statement apparently made in this House. I do not know the answer to that question and I do not know how I would every know it.
	The route which the German Government found to give exemption for coal-mine methane is not self-evidently a route which is open to us. However, we are looking for every option that can be made available to us.

Lord Swinfen: My Lords, if methane gathered from capped landfill sites is exempt from the levy and, as with coal, it is not strictly renewable, is the coal-mine methane not exempt, too?

Lord McIntosh of Haringey: My Lords, the sad answer is that it is strictly renewable because landfill sites continue to be filled. As we produce more rubbish we continue to create landfill sites and the methane which escapes is renewable. It is a matter of definition and we cannot get around it. Coal-mine methane comes from fossil fuels accumulated over millions of years. There is a real difference between the two, but it should not be a difference that affects the tax treatment of coal-mine methane.

London Underground

Lord Peyton of Yeovil: My Lords, I beg leave to ask a Question of which I have given private notice, namely:
	Whether Her Majesty's Government, since they will have no further opportunity until October, will now say what steps they have in mind concerning the London Underground following the dismissal of Mr Kiley as chairman.

Lord Falconer of Thoroton: My Lords, the Secretary of State for Transport, Local Government and the Regions announced on 5th July that London Transport and London Underground would continue with plans to deliver a modern publicly run and privately built Tube. They will work to achieve that goal as quickly as possible while ensuring safety and value for money and they will continue to focus on delivering a first-class Underground service to the public.

Lord Peyton of Yeovil: My Lords, I am only slightly grateful to the noble and learned Lord for that reply. Does he see some sense in this? The daily torture endured by thousands of passengers on the London Underground suggests that the present management is inadequate and should be replaced and that Mr Kiley's dismissal in the circumstances is likely to be made by events to appear a serious error. Will he bear in mind that partnerships between those whose interests conflict tend to be fertile ground on which excuses grow and put safety in jeopardy? That has been demonstrated by recent sad events.

Lord Falconer of Thoroton: My Lords, the delays endured by people in the Tube, referred to yesterday in a report, and the periods of time spent by people on the Underground in trains which have stopped, indicate that the Tube urgently needs major investment. The government proposals involve levering into the Tube £13 billion over time. They involve a detailed plan for achieving that investment over the long term. I think that the people of London want those plans put into effect as quickly as possible so that the improvements in the Tube that we all wish for start as quickly as possible.
	Mr Kiley was made chairman of London Transport in order to conclude those agreements. He notified the Prime Minister by letter that he had failed to conclude those contracts. He was removed, therefore, as chairman of London Underground with the concurrence of the majority of the board of London Transport, whose confidence he had lost.

Lord Mackenzie of Framwellgate: My Lords, I declare an interest as a long-suffering and perspiring commuter on London Underground. Does not the huge sum to which the Minister referred need to be invested in London Underground as soon as possible after years of neglect?

Lord Falconer of Thoroton: My Lords, I agree that what is needed is investment in the Tube. The arrangements proposed by the Government ensure that investment. At all times they put safety first. The London Underground will have responsibility overall for safety under the supervision of the Health and Safety Executive.

Earl Attlee: My Lords, perhaps I may say how grateful we are to the Leader of the House for accepting this PNQ.
	Mr Kiley has an international reputation for running a tube system. Has the Minister's right honourable friend the Chancellor of the Exchequer had any detailed discussions with Mr Kiley and, if so, when?

Lord Falconer of Thoroton: My Lords, I am not aware of any discussions between Mr Kiley and the Chancellor of the Exchequer.
	As regards the Tube, I think that everyone agrees that what is required is long-term investment. That is what the proposals involve. They put safety first; they put investment first; and they put the needs of the underground traveller first. We need to get on with delivering them.

Baroness Hamwee: My Lords, I am sure the Minister is aware that as chair of London Transport Mr Kiley instructed two firms of independent consultants to advise on whether investment through their scheme could deliver the service. One firm, Parsons Brinckerhoff Ltd, was asked:
	"Is the current LUL Standards Regime adequate to control the standards of workmanship and safety related activities of the Infracos under the anticipated PPP contracts?"
	The summary of its report states:
	"The current standards are neither adequate nor appropriate to be used as a management control tool to protect LUL's long-term interests in exercising control over Infraco workmanship and safety under the PPP".
	The Minister referred to putting money into the Tube, Following that devastating analysis, and the proceedings in the High Court this week, does the noble and learned Lord agree that, win or lose, the Government will put in the £700 million that they have promised for their PPP?

Lord Falconer of Thoroton: My Lords, let us be clear. Mr Kiley, or his consultants, will not decide whether the Underground is safe. Mr Livingstone will not decide whether it is safe. The Government will not decide whether it is safe. The Health and Safety Executive, an independent, tough regulator, presently bringing proceedings against London Underground in relation to safety, will decide whether the Underground's safety standards are good enough. It will decide on London Underground's arrangements now. It will decide again when the private sector infrastructure companies make their proposals for change.
	Consultants can be instructed by both sides, as the noble Baroness knows. Those consultants can be given instructions as to what to say. But the critical issue is whether or not the Health and Safety Executive, an independent body, takes the view that it is safe.
	We all agree that investment is required. That is what the government proposals ensure.

Lord Dubs: My Lords, my noble friend referred to the investment of large sums of money to improve London Underground. Can he give us an idea when millions of long-suffering passengers will see the first improvements?

Lord Falconer of Thoroton: My Lords, the first improvements will start to flow once the arrangements made by the Government can be put into action. The longer these wrangles continue the slower the improvement.

Baroness Hanham: My Lords, does the Minister accept that the situation with regard to London Transport and London Underground is an utter shambles? Does he also accept that the indication by the mayor, Ken Livingstone, that he will introduce congestion charging on the back of an improved transport system is wholly unrealisable? Should not the Government step in immediately to say that congestion charging in London cannot be implemented until, at some unlikely time in the future, the London Underground is improved?

Lord Falconer of Thoroton: My Lords, the Government have had a consistent policy for a number of years. We have consistently sought to introduce the arrangements we seek to introduce now. Mr Kiley and Mr Livingstone have criticised them; they have sought to block them; and they seek to block them in court at present. The right thing to do is to rally around those arrangements so that the improvements the Underground users so desperately want can flow through as quickly as possible.
	The Government have always made it clear that improvements in public transport should accompany congestion charges. The congestion charges proposed by the mayor are at present out for consultation. The points that the noble Baroness makes can no doubt be made in the course of the consultation.

Earl Russell: My Lords, perhaps I may--

Several noble Lords: My Lords--

Lord Williams of Mostyn: My Lords, I think that it is the turn of the Liberal Democrats.

Earl Russell: My Lords, in reply to my noble friend Lady Hamwee, was the Minister attempting to suggest that Parsons Brinckerhoff Ltd was not independent? If he was not, will he deny the impression which may have been inadvertently created? If he was, will he take the risk of repeating the opinion outside this Chamber?

Lord Falconer of Thoroton: My Lords, I am not in any way suggesting that it is not independent. An e-mail from Steve Polan, an adviser to Mr Kiley, to the consultants says:
	"not to endorse in any way"
	a review of standards after the private sector had come in; to
	"make the conclusions more pointed";
	and to remove quotes
	"that were not particularly helpful".
	That is an e-mail from one of Mr Kiley's advisers to Parsons Brinckerhoff.

Lord Williams of Mostyn: My Lords, we have come to the end of the 10 minutes that the Companion indicates.

Commonhold and Leasehold Reform Bill  [H.L.]

Lord Irvine of Lairg: My Lords, I beg to move the Motion standing in my name on the Order Paper.
	Moved, That it be an instruction to the Committee of the Whole House to whom the Commonhold and Leasehold Reform Bill [H.L.] has been committed that they consider the Bill in the following order:
	Clauses 1 and 2, Schedule 1, Clauses 3 and 4, Schedule 2, Clauses 5 to 33, Schedule 3, Clauses 34 to 57, Schedule 4, Clauses 58 to 66, Schedule 5, Clauses 67 to 70, Schedule 6, Clauses 71 to 100, Schedule 7, Clauses 101 to 121, Schedule 8, Clauses 122 to 146, Schedule 9, Clauses 147 to 152, Schedule 10, Clause 153, Schedule 11, Clauses 154 to 164, Schedule 12, Clauses 165 and 166, Schedule 13, Clauses 167 to 170, Schedule 14, Clauses 171 to 173.--(The Lord Chancellor.)

On Question, Motion agreed to.

Code of Conduct

Lord Williams of Mostyn: My Lords, I beg to move the Motion standing in my name on the Order Paper.
	With one exception, the Motion is purely consequential on the resolution that your Lordships passed on 2nd July, when the House agreed to adopt a new code of conduct to take effect from 31st March next year. The Motion simply gives effect to that decision in the usual way.
	The code to which we agreed requires us all to register various interests in various categories by the date that I mentioned. To allow us to comply, there needs to be a register in existence between now and then so that interests may be registered.
	There may have been some misunderstanding, so I must make it plain to your Lordships that the Motion has been tabled on the advice of the Clerk of the Parliaments and drafted by the House authorities. They have advised me--and I entirely accept their advice--that the Motion is a procedural necessity consequential on our earlier decisions.
	I said that there was one exception. Your Lordships will have seen that one part of the Motion is not consequential on our earlier decision. It is the amendment to paragraph 18 of the code, which inserts "in private" after "allegation". I promised your Lordships that I would bring forward an amendment to ensure that any allegations of misconduct were to be made privately. I took that--I think correctly--to be the will of the House. That is the reason for that single amendment. I made that promise and I hope to have fulfilled it by placing that matter in the Motion.
	The noble Lord, Lord Elton, has tabled an amendment. I thank him for his invariable scruple in informing me of what lay behind his views. Perhaps I can help him and the House by setting out the thinking that I have come to. I agree that we would benefit from a review of the operation of the code once it has bedded down. I have mentioned to him that I thought that 12 months was rather a short period for a review and have suggested 18 months. If it will satisfy the noble Lord, I am happy to give an assurance that the House will have an opportunity to have a full debate reviewing the operation of the code 18 months after it comes into force. I beg to move.
	Moved to resolve, That the resolution of the House of 2nd July be amended as follows: After paragraph 6, insert: "Register of Interests
	6A. There shall be established a Register of Lords' Interests referred to in this Code. The register shall be maintained under the authority of the Clerk of the Parliaments by a Registrar appointed by him.
	A Member of the House must register relevant interests before 31st March 2002 and thereafter within one month of acquiring them. The register shall be available for public inspection in accordance with arrangements made by the Registrar. The register shall be regularly updated and shall be reprinted annually. The annual publication shall include all interests registered since the previous edition and all continuing interests unless their termination has been notified to the Registrar." In paragraph 17, at beginning insert "The operation of the register shall be overseen by a Sub-Committee of the Committee for Privileges on Lords' Interests and the Registrar shall consult the Sub-Committee when necessary.". In paragraph 18, in sub-paragraph (b), line 2, after "allegation" insert "in private". Leave out paragraph 19 and insert:
	"19. Paragraph 6A shall have effect forthwith; the remainder of this Code shall have effect from 31st March 2002; and the resolution of the House of 7th November 1995 on the practice of the House in relation to Lords' interests shall cease to have effect on the same date."--(Lord Williams of Mostyn.)

Lord Elton: rose to move, as an amendment to the above Motion, at the end of paragraph 19 to insert "; and the Code apart from paragraph 6A shall cease to have effect on 31st March 2003."

Lord Elton: My Lords, your Lordships will not have forgotten the temperature of our discussion on 2nd July. I certainly never will. On that occasion we came to a decision. It was achieved by a narrow vote and I suspect that many kicked themselves afterwards for the way in which they voted, but our rules of procedure are that we do not return to the same question in the same Session. I do not intend to do that. I have my reservations. They are known because of the dissenting report that my noble friend Lord Kingsland and I signed when the report of the committee was adopted.
	However, we are committed to a course about which many of your Lordships have sincere, deep and, in my view, well founded anxieties. As we cannot re-open the issue now, we wish to be assured that there will be an opportunity to re-open it in the future.
	My amendment would provide for the system that we have put in place to cease on 31st March, 12 months after it comes into force. I would have tabled a different amendment had the procedure been available to provide for the debate that the noble and learned Lord the Leader of the House has undertaken to afford us an opportunity to hold--that is, to make our order a negative procedure order. I see the Clerk furrowing his brow to follow my reasoning. If he is having difficulty, I am sure that I have lost the rest of your Lordships entirely.
	My intention is that there shall be a cast iron opportunity for a review. That can be achieved by the undertaking that the Leader of the House has offered your Lordships. That does not mean that the system will collapse if the date passes without his honouring that opportunity. We rely on his good faith and that of the Government to deliver his undertaking. I am therefore minded to seek the leave of the House to withdraw my amendment when your Lordships have had an opportunity to speak your minds and have heard the noble and learned Lord repeat his undertaking that there will be a full debate on the system in government time before 31st October 2003. In that debate, any noble Lord will be able to table an amendment to bring the system to an end. I beg to move.
	Moved, as an amendment to the above Motion, at the end of paragraph 19 to insert "; and the Code apart from paragraph 6A shall cease to have effect on 31st March 2003."--(Lord Elton.)

Lord Renton: My Lords, I support the proposals of my noble friend Lord Elton, but I feel bound to make some other points. I welcome the amendments now proposed by the Government. They will help, but they do not overcome the problems raised by paragraph 12 of the code of conduct, about which I protested on 2nd July and have done so again at Question Time since then. It would be helpful to the House--and to the Leader of the House--if, in preparation for any future development, the inadequacy of the drafting of that paragraph was addressed. The paragraph requires us to declare "relevant financial interests", which may include:
	"shareholdings not amounting to a controlling interest;
	landholdings (excluding Members' homes);
	the financial interests of a spouse or relative or friend".
	That last provision is the most obscure and puzzling.
	The difficulty with paragraph 12 is that there is no limit, except the rather strange limit "depending on their significance", which appears in brackets on the second line. We are not told what the significance is. There is no limit to that definition. When Members are anxious about the issue, who is to decide what the significance is to be? The phrase is undefined. Requiring the declaration of the
	"financial interests of a spouse or relative or friend"
	covers a very broad range and the provision is unenforceable. If the Leader of the House wants the code of conduct to be acceptable in all parts of the House and to be successful, he should consider what can be done about that.

Lord Strathclyde: My Lords, I entirely agree with my noble friend Lord Renton. There are significant problems in the drafting of the code. I shall touch on some of the points that he raised in a moment.
	On 2nd July we debated a new code of conduct and Register of Interests. The Motion was passed by the House, albeit by a very narrow majority. The code was the noble and learned Lord's first gift to the House as its leader. In authorship and advocacy, it is truly the Williams code. It might be helpful if we called it that, to differentiate it from the Griffiths code, which we have had until now.
	After only three weeks, we are seeing amendments to the code. The noble and learned Lord rightly said that the Motion was to some extent consequential. But one of the main reasons that it is consequential is the glaring inadequacy of aspects of it, as pointed out at the time by my noble friend Lord Kingsland. Originally, there was no requirement that complaints against Peers should be made in private, thus avoiding the unedifying spectacle of competitive allegation by press release that has so damaged the reputation of another place. When my noble friend put forward amendments to put that and, in my submission, other defects right, the noble and learned Lord advised the House to reject those amendments. He has now accepted this one. I thank him very much for doing so, and I urge the House to support the Motion in that respect.
	However, if the noble and learned Lord missed that fundamental point after many months of work on the code that he recommended, is he sure that he is still happy with the rest of it? For example, as my noble friend pointed out, is he still happy with the requirement to register relevant interests of friends? After all, who are friends and how are they defined? Yesterday the noble Lord, Lord Peston, said that he has no friends. My noble friend Lord Marlesford said that the noble and learned Lord the Lord Chancellor is a friend. Therefore, will the noble Baroness, Lady Jay of Paddington, now be obliged to spell out to the House the interests of friends who contributed to the Prime Minister's blind trust, of which she was the chief trustee? Shall we hear the footsteps of the noble Lord, Lord Levy, carrying his black book up the staircase to the registrar's office? If not, why not? After all, they voted for this code. There appears to be no guidance anywhere as to what will constitute "friends".
	In the past, the Leader of the House has claimed that all that is set out in the Griffiths code. But if he cannot see the distinction between a recommendation to declare orally a relevant interest in a specific debate and mandatorily hanging the interests of one's friends, relatives, spouses and partners on the Internet washing line in a register, I suspect that the House can.
	I also understand that concerns have been raised about human rights, on which the noble and learned Lord is an expert. Therefore, I wonder whether he will be able to explain exactly how his code is compatible with the human rights of those who are not Members of the House but whose privacy will be infringed by the publication of their interests on the Internet.
	We still do not know how widely drawn the definition of "relatives" will be. Will it include a stepbrother, a second cousin or a divorced wife's sister? I refer to the point made by my noble friend Lord Renton, who perhaps expressed the matter rather better than I am doing. The noble and learned Lord, Lord Williams, prides himself on his mastery of precision in language. But it is striking that the Williams code is riddled with generalities and uncertainties, and I do not believe that it does a service to this House to leave Peers in this position. It is also grotesquely unfair to the Clerks of the House to place all responsibility in relation to what is right and what is wrong on the registrar.
	In the past, the noble and learned Lord has spoken of a "light touch". Therefore, perhaps I may ask him where the light touch will be applied, to whom it will be applied and on what grounds. Those questions require clear answers. Furthermore, why is there no de minimis rule in the code or the register? After all, another place has one. Under the guidance of the noble and learned Lord's predecessor and, indeed, on his own guidance, noble Lords opposite who are Ministers have had to register interests as trivial as the gift of a golf ball or a packet of tea leaves. That is all set out in the ministerial register. Is that the way that the noble and learned Lord wants all Peers in this House to behave?
	I have taken a few minutes of the House's time to illustrate a few of the many difficulties that still lie in the code as voted through on 2nd July. It is right that we should review sceptically all aspects of the code before we are made to live with it. It is not the principle that is the problem; that is done, dusted and agreed. However, the small print is causing an increasing amount of confusion. It cries out for clarification and amendment if this House is not to risk division and, still worse, ridicule. Even worse, the code may risk being ignored by Members of this House.
	Therefore, I welcome the fact that the noble and learned Lord has accepted the suggestion by my noble friend of a review. I welcome the fact that today he brought forward the first amendment to the code. However, I very much hope that it will not be the last. I hope that we shall be able to use the next six months to make changes in order to avoid some obvious and avoidable problems, and I look forward to receiving the assurance of the noble and learned Lord in his reply.
	I also do not believe that on the last day before the Summer Recess, with almost a minimum of notice, we should discuss a matter which touches every Peer. We should not bring in a new register forthwith before, in the words of the noble and learned Lord, wrinkles identified in the code are ironed out. It is all very well for the noble and learned Lord to say that "forthwith" applies only to the existence of the register and not to its operation. But can he confirm that, as from the end of this debate, any Peer who goes to the registrar will have to register the interests in the Williams code and not the Griffiths code? We were not given notice of that through the usual channels before the Motion was laid. It is only because I do not wish to be churlish or to confuse what is a crucially important issue of finding a workable register that I let that rest.
	Perhaps I may repeat the advice that I gave to the noble and learned Lord last week. He risks allowing himself to appear a little too much in a hurry, a little too impatient for the detail and a little too ready to identify wisdom with his personal conviction. Today, the noble and learned Lord has made a good move in listening and acting on the matter of privacy. I hope that he will now listen and act on other worries that many Peers have. It is not sufficient merely to accept the amendment of my noble friend Lord Elton; he will need to be ready to make other amendments before next March.

Earl Ferrers: My Lords, perhaps I may say a few words. I had not realised that my noble friend was intending to rise. Then the noble Lord the Government Chief Whip rose and I believed that he was going to tell us to hurry along.

Lord Carter: My Lords, in response to the noble Earl and the noble Lord, Lord Renton, I was intending to remind the House of the section in the Companion which states that debate must be relevant to the Question before the House. Of course, the Question before the House is the amendment moved by the noble Lord, Lord Elton. We should restrict our discussions to that amendment and to the words in the Motion of my noble and learned friend the Leader of the House.

Earl Ferrers: My Lords, that is fine but, of course, the amendment seeks to amend the code. Therefore, surely one must be permitted to ask a few questions. If I am not permitted to do so, I shall not. However, were your Lordships to be kind enough to allow me to ask a few questions, I should be grateful if the noble and learned Lord would answer them.
	We are moving into a different sphere. I am a simpleton with regard to this issue. Everyone may say, "It is perfectly all right. The matter has been decided, so don't bother about it". However, the noble and learned Lord may be able to explain one point for me. If one describes one's employment as "a non-parliamentary consultant", does that mean that a solicitor, or perhaps an accountant, who retires from his firm must register the fact that he is a consultant? Or must a retired director say, "I am now a consultant"? With regard to voluntary organisations, if one is involved with the local cricket or British Legion club, must one register that fact?
	As my noble friend Lord Renton said, what about the position of spouses, relatives and friends? Your Lordships may say that that has nothing to do with the amendment. However, it has much to do with the original Motion which is being discussed. What, for example, about a partner? That is a very fashionable expression. Does it refer to a wife, a friend or a spouse? Under what category does it come? As my noble friend Lord Strathclyde said, why must this matter be hurried? We have been without the code for a long time but have now accepted that it should be put in place. Apparently, it will come into effect as from tomorrow.

Noble Lords: No.

Earl Ferrers: My Lords, I make that point so that the noble and learned Lord can push me down and say what a fool I am.

Lord Williams of Mostyn: My Lords, the code does not come into effect from tomorrow. It comes into effect from March next year. I simply want to assist the noble Earl. I declare my interest as being a friend of his.

Earl Ferrers: My Lords, I am deeply gratified by that. I am even more gratified that the noble and learned Lord has been able to provide me with an answer.
	However, I am anxious to ask the noble and learned Lord about another matter which I do not understand. Under the noble and learned Lord's amendment to the code, under "Register of Interests", paragraph 6A would read:
	"A Member of the House must register relevant interests before 31st March 2002".
	The amended paragraph 19 would read:
	"Paragraph 6A shall have effect forthwith".
	Those statements appear to be contradictory. The noble and learned Lord signals to me that they are not. That is fine. I have explained to your Lordships that I am very stupid in relation to these matters and that I climb uphill very slowly. I should be grateful if the noble and learned Lord would put me right on that issue in due course.
	I turn to an important point--although all my points are important. A relevant interest involves not whether a Member's actions will be influenced by the interest but whether the public might reasonably think that that might be the case. How on earth does one judge what the public are going to think about an interest? Who is to decide whether the interest should be registered in the public interest? There is a tremendous variety in that regard. A great deal of responsibility is placed on the registrar, who will decide what is and what is not permitted. I apologise for having taken up so much time and for doing so in the wrong sequence.

Lord Goodhart: My Lords, there has been a good deal of misunderstanding about the code's effect--sometimes, I feel, because no great effort has been made to understand it. I do not want to go into the issues again today because they were debated on 2nd July and because the noble Lord, Lord Carter, pointed out that they are not being raised today.
	We on these Benches welcome the proposal that the allegations must be made in private. We believe that the code is unlikely in practice to cause the difficulties envisaged by some noble Lords but we are happy to welcome the undertaking that we understand the noble and learned Lord the Leader of the House will give about a review in due course of the code's operation.

Lord Waddington: My Lords, it would be advisable if the code were to lapse after a period if only to provide an opportunity to redraft it in more understandable language. I raised that matter with the noble and learned Lord the Leader of the House a while ago.
	Paragraph 5 refers to, "Members of the House", and to "Holders of public office". I asked the noble and learned Lord for a definition of a holder of a public office but he gave me no reply. For the life of me I cannot understand how it can be said that a life Peer is a holder of a public office. I stand by that statement. If the noble and learned Lord says that we are holders of public office, I should like him to explain why; if we are not, paragraph 5 is a complete nonsense.

Lord Renton: My Lords, before the noble and learned Lord replies, I hope that it is in order and of advantage for me to reassure the noble Lord the Chief Whip that that part of our discussion that he said was irrelevant is not irrelevant. I refer him to proposed paragraph 6A of the code, which states:
	"A Member of the House must register relevant interests".
	It was in an effort to explain the significance of "relevant interests" that some of my noble friends and I felt that it was right to draw attention to the difficulty that that phrase created in relation to paragraph 12.

Lord Campbell of Alloway: My Lords, I begin by accepting that one deals with a Motion as it stands and point out that the proposed amendment to paragraph 17 would not meet the concerns expressed by the noble and learned Lord, Lord Nolan, and would require the serious attention of any review. The sooner that that review is held the better.
	Paragraph 12 refers to the financial interests of spouses. Paragraph 17 will have to be amended in due course to give effect to the requirements of Article 8 of the convention and to deal with the concerns of the noble and learned Lord, Lord Nolan. Furthermore, when the code is operated by the registrar, the test that he will apply will be governed by that article. There is no reference in that article--I am not going into legalistic details--to public interest. The adjudication is strictly governed by the terms of that article. That matter will require detailed consideration as soon as possible and perhaps the addition of amendments to the code.
	I gather that it is acceptable to my noble friend Lord Strathclyde that we should wait for 18 months. So be it. I should prefer it if we could have a debate before 31st March, when all of those matters could be considered. I do not want to use up the House's time further. My respectful suggestion to the noble and learned Lord, Lord Williams of Mostyn, is that he should accept that the House is unsettled on this matter. We should have this debate and consider general amendments before 31st March 2002.

Lord Selsdon: My Lords, I had not intended to speak today; I had hoped to have an opportunity to speak last week but because we ran out of time I took the liberty of writing to the noble and learned Lord--I sent him a letter containing what I would have said to the House. I shall speak to his amendment and to that in the name of my noble friend Lord Elton. I shall try to provide some help and guidance.
	All my life I have been forced to disclose--and have willingly disclosed--interests. That was mainly on the commercial side. I have a concern about the code's drafting but not its principles. The experience of codes in the commercial sector has highlighted problems of which noble Lords may be aware--I refer to the codes of Cadbury, of Greenbury and of Turnbull and to the Hample combined code, which relates to the way in which directors should behave. Those codes have caused many problems of interpretation and involve tremendous bureaucracy. We are debating another code that is based on no law of which I am aware. I suggested to the noble and learned Lord that we might examine the commercial sector and follow some of its rules in the declaration of interests.
	I turn to the disclosure of directorships. The Williams code, as it is called, states that only remunerated directorships should be involved. However, any director of a company is required each year to fill in form 288A listing all of his directorships. It would be simple to adopt that approach. The disclosure of directorships would be public.
	The second area that caused me concern involved the definition of spouse, family, friends and so on. In Section 12 of the Companies Act there is a description of connected parties, which effectively means a spouse, children, including illegitimate children, and stepchildren under the age of 18. It draws attention to companies and interests related thereto. That is quite a good guideline for the Williams code.
	I turn to the problem of families. The noble and learned Lord will have appreciated from my letter to him my difficulty, which arises because my wife's family name and my mother's family name is Williams. According to the advice that I received last weekend and the Internet--I visited Salt Lake City with the Mormons--a relative is any blood relative of a particular generation or the generations that follow. I am happy to inform the noble and learned Lord that I have, I am advised, about 57 Williams cousins, including my kinsman, the Spanish ambassador in London. The Williams girls in my family all preferred to marry Latin lovers, became Catholic and produced quite exorbitantly--I think that it is fair to say that. We need to define what a relative is.
	Relationships and money do not mix well. Divorce rates and internal family problems and squabbles all come down to money. Disclosure of other people's interests leads to problems that I have also considered and on which I have taken advice. If you break a confidence, whether or not there is a letter of confidentiality, and a material loss occurs, or extra costs occur, the person who makes that disclosure could, I understand, be personally liable. Therefore, I have taken the step of inquiring what professional indemnity insurances we should consider taking out if we are forced or required, wittingly or unwittingly, to disclose something which could lead to a material loss. Those are all minor issues but they can mount up and if, over the coming year, and before the matter is reviewed, we could perhaps look at the harmonisation of what is now known as the Williams code, I should appreciate it and many people outside would appreciate it.
	If we fail to do that, there is a danger that the investigative press and others may have a field day. That is a worry because, as the noble Baroness, Lady Williams of Crosby, said in her excellent speech the other day, a low opinion is accorded Parliament, followed by politicians, even lower, and the press at the bottom. There are many worries for the future but I wish the noble and learned Lord, Lord Williams, well.

Lord Marlesford: My Lords, I rise to support the amendment in the name of my noble friend Lord Elton. He is suggesting that the House should have the opportunity to review this code, its practicality and the effect of its implementation.
	My worry about the amendment is that it would not come into effect until one year after the code had been in force. The noble and learned Lord the Leader of the House suggests that it should be 1.5 years after the code has come into force. I really feel that that is much too late. It is not good enough for the noble Lord, Lord Goodhart, to say that the concerns which have been expressed are overdone, as he implied a few moments ago; that it will all be quite simple; and that we should get on with it.
	I remind your Lordships of what the noble and learned Lord, Lord Nolan, who, in a sense, is the father of much of this invigilation, said:
	"First, whatever form of resolution or amendment is adopted by the House, please let what has to go in the register be as clear as possible. The burden placed on the registrar will be very heavy. Many instances have been raised when, with the best will in the world, it will be difficult to say that something should or should not go in".--[Official Report, 2/7/01; col. 671.]
	It is not acceptable that the code should come into effect before the questions have been answered. My noble friend Lord Strathclyde made a crucial point when he referred to the difference between declaration and registration.
	On 2nd July, the noble and learned Lord the Leader of the House referred repeatedly to the fact that the Griffiths Committee had already accepted the concept of "friends". Of course that is so, but he did so in terms of declaration. That is the crucial difference. Registration produces far more instances of difficulty.
	The noble and learned Lord referred to his original proposals as being to accommodate public perception. In that context, I suggest that "perception" means "viewed through the eyes of the beholder". As the public is an amorphous concept, public perception is the view as seen and expressed by the media.
	The noble and learned Lord volunteered an example of the sort of interests of friends which it may be necessary to register. He gave the example of a 1 per cent shareholding of BP. As your Lordships all know, the market capitalisation of BP is £126 billion. Therefore a 1 per cent share would be £1.26 billion. With great respect, that was not a very realistic example to take. Therefore, I tried to persuade the noble and learned Lord to make his example more realistic. I suggested a figure of 0.001 per cent. As your Lordships will realise immediately, 0.001 per cent of £126 billion is £1.26 million. That is not an impossible figure. The noble and learned Lord did not reply to the example which I gave. But it is not impossible that a friend of one of us in this House might have that sort of a shareholding.
	But are we seriously expected to declare that interest in a register? Are we expected to register that interest as opposed to declaring it, possibly if there were to be a debate directly affecting BP or some part of the oil industry? That is the absolute basic point I wish to make. I shall illustrate it with another example that the noble and learned Lord gave. The noble and learned Lord said:
	"A noble Lord might have such a close friend that if he knows of a significant interest ... he might feel that he had discharged his duty properly by saying, 'I have to say that a close friend of mine is a very large landowner ... and that will affect him. It is as simple as that".--[Official Report, 2/7/01; cols. 640 and 641.]
	That is totally unclear. What is meant by a "very large landowner"? The implication is that that should be declared during a debate. I have much less of a problem declaring matters during debates than I have with declaring them in the register.
	Interestingly, the noble and learned Lord referred also to "a close friend of mine". A fundamental question to which we have not received an answer, and to which we need an answer before we go any further with this debate, is whether or not the noble and learned Lord suggests that we shall be required to register the names of those who have those interests. Nobody has yet made that clear. Are we or are we not required to register the names?
	The noble and learned Lord gave an example of a very large landowner. In this House, we probably all know a number of landowners. Whether they are large or very large is, of course, in the eye of the beholder. I do not believe that it is sensible for us to proceed further without those questions being answered.
	Finally, I return to the amendment tabled by my noble friend Lord Elton. I am rather worried as to whether he has taken into account the desirability of travelling in the dark for a year, let alone a year and a half, before we receive the appropriate guidance.

Lord Williams of Mostyn: My Lords, I am sorry to repeat myself. This is a purely consequential order, following on a decision which has already been made. Some of your Lordships did not agree with it; the majority did. Your Lordships would have looked at me with some disfavour if I had attempted to reopen the issue today. If anybody had pressed me to do so, I should have refused for the single reason that the noble Lord, Lord Elton, with his invariable scruple, identified right at the beginning of his remarks.
	However, those are questions of taste and judgment upon which we all have different views. I share the view that the noble Lord, Lord Elton, nobly set out because I bear in mind that he was a member of the group which I chaired and he did not share the conclusions of the majority. Nevertheless, he made the point scrupulously that that decision has already been taken by this House.
	The noble Lord, Lord Strathclyde, also took the same principled stand; namely, to urge this House to approve the Motion which is tabled in my name. I listened to your Lordships. We needed no vote. It seemed to me that the feeling of the House in the privacy context was very substantial. That is why I brought forward this measure as soon as I sensibly could. If I had left it until later in the year, I believe that your Lordships, quite reasonably, would have inquired of me, "What is the reason for the delay?"
	Yesterday I moved a consequential procedural Motion in the usual way and today I am doing exactly the same. It is not for us today to re-open the issue that has already been decided. I do not propose to enter into that debate. The noble Lord, Lord Strathclyde, called it the "Williams code", so at least one Welsh family will be happy. He said that it was my "gift". I hope that it was not regarded in that way; I hope it was regarded as a service. I could be wrong--it is possible.
	If I am wrong, we shall meet that situation, with the amendment tabled by the noble Lord, Lord Elton. He was good enough to discuss it with me--I hope I met his concerns--and I suggested that a review after 18 months would be prudent and reasonable. I cannot guarantee him government time--the Chief Whip tells me that there is no such thing. I reiterate my promise--I am happy to stand by it--that, when challenged 18 months after March of next year, we shall have the opportunity to debate these matters. In these circumstances it is inevitable that not everyone is pleased, but on 2nd July we had a full debate and there was a majority in favour of what was put forward, which is now the subject of this procedural resolution. I beg to move.

Lord Elton: My Lords, the noble and learned Lord cannot move his Motion until I have had my say.

Lord Williams of Mostyn: My Lords, the noble Lord is quite right and I apologise.

Lord Elton: My Lords, I thank noble Lords who have deployed, even if on the margins of good order, their concerns about what will happen under the code because that will direct the attention of those who supervise our procedures to where it is most needed. My noble friend Lord Marlesford is anxious that even a year may be too soon and that I should not be satisfied with 18 months. There is nothing in what I am proposing or in what the noble and learned Lord the Leader of the House is offering that prevents any noble Lords tabling a Motion in the next six months. This amendment states that it shall not be later than a certain date; that does not mean that it shall not be earlier.
	The impatience of my noble friend Lord Marlesford may gain him sufficient friends to start a movement in that direction. I do not encourage him to do that because, having reflected on the opinion of the Leader of the House, which I was courteously given yesterday, I am minded to conclude that 18 months may be better than a year. If in the first six months things go disastrously wrong, your Lordships can take the matter into your own hands; if it does not, we shall want a good slice of experience on which to base our decision. Your Lordships can take what steps you believe are correct 18 months after March next year.
	The noble and learned Lord, Lord Williams, has declared his friendship for my noble friend Lord Ferrers. In due time the register will reveal, if not the closeness of, at least the depth of knowledge of that friendship, because he will now have to put down everything that he knows about my noble friend's interests. I see that my noble friend is looking somewhat anxious.

Earl Ferrers: My Lords, my noble friend Lord Elton has answered the point that was agitating me. If the noble and learned Lord regards me as a friend--he said that that fact is an interest--I intended to ask him, but of course I forgot, whether that entitled him to put down all my personal interests as a friend of his in his register entry. I hope not.

Lord Elton: My Lords, I do not believe that the Leader of the House is to be drawn into breaking the rules of order further by answering that point.

Lord Williams of Mostyn: My Lords, the noble Earl and I have been friends for some time. I do not know what his shareholdings are; I do not know what his land-holdings are; I do not know the financial interests of his spouse, relative or friend, or of any hospitality or gifts. As I said the other day in the context of the question put by the noble Baroness, Lady Park of Monmouth, if one does not know, one cannot be influenced. The only thing that influences me about my friendship with the noble Earl, Lord Ferrers, is that I believe we agree on virtually nothing, but we never quarrel about anything.

Lord Elton: My Lords, in future we shall choose our friends with care. In conclusion, I regret I omitted to acknowledge the importance of the introduction of the word "private" into the code. The greatest damage that can be done to this House will be by the premature feeding to the press of allegations and suspicions that they then pursue, like the hell-hounds that many of them are. I counsel all noble Lords to regard that privacy as sacrosanct until the moment at which either the procedure makes it necessary for it to become public, or the person accused feels that it is in his or her interests to make it so.
	I believe that we have done all that we can. If the Leader of the House will signify that the debate that he proposes, which cannot be in government time--because there is no such thing--will be in prime time--your Lordships all know what that is--on a government Motion, I shall yield to him and I shall be happy to ask your Lordships' permission to withdraw my amendment.

Lord Williams of Mostyn: My Lords, all time in this House is prime, but I understand what the noble Lord means and I give him that assurance. From my recollection, I believe that that is a little more generous than that which we received when we were in opposition.

Lord Elton: My Lords, I can think of no courteous reply to that so I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	On Question, Motion agreed to.

British Overseas Territories Bill [H.L.]

Baroness Amos: My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
	Moved, That the House do now resolve itself into Committee.--(Baroness Amos.)

On Question, Motion agreed to.
	House in Committee accordingly.
	[The DEPUTY CHAIRMAN OF COMMITTEES (Baroness Serota) in the Chair.]
	Clauses 1 and 2 agreed to.
	Clause 3 [Conferral on British overseas territories citizens]:

Baroness Rawlings: moved Amendment No. 1:
	Page 2, line 29, at end insert--
	"( ) A person who claims British citizenship by virtue of this Act and who exercises his right of abode in the United Kingdom shall be subject to United Kingdom tax regulations."

Baroness Rawlings: I begin this Committee stage by expressing the hope that the Minister, unlike during proceedings on the International Development Bill, may be able to concede some of our amendments to save us from dividing. I understand that that may well be a pious hope.
	I thank the noble Baroness, Lady Amos, for her constant courtesy. At all times when we have worked together, the Minister has been most helpful. At this late stage, having missed the chance in earlier debates, I congratulate her on becoming a Minister of State, covering both Foreign Office affairs and international development portfolios. I know she will carry out the task admirably as she has always done. I wish her the best of luck. It amused me to see that the Government, who took away the international development ministry from the Foreign Office, have found it necessary to put it back together again.
	I am also grateful to the noble Baroness for sending me a letter with many details concerning the Bill. Unfortunately, it arrived only late yesterday afternoon, well after we had tabled our amendments. It answers some of our questions, but I would like further clarification as much of the Bill is complex; for example, on the right of residency, as mentioned in the International Criminal Courts Bill and the Political Parties, Elections and Referendums Bill, where even the noble Lord, Lord Goodhart, could not come to an exact agreement on the definition of "residence". This is an important subject, especially for the 200,000 people concerned.
	In the section on rights and responsibilities, there are, as we thought, many rights but few tangible responsibilities. Will the Minister in her answer spell out to your Lordships the nature of those responsibilities? Forgive me if I repeat some of the questions that the Minister has already answered in her personal letter to me. It will, however, enable them to be recorded in Hansard.
	I now speak to Amendment No. 1, which seeks to address the tax implications of this Bill. British Overseas Territories citizens attach a great deal of importance to the control they have over their fiscal regimes. It is important that the Bill should not give excessive control of our territories' tax structures to alien influences. Many general financial issues were raised in the Government's 1999 White Paper, several of which have not been addressed in the Bill.
	Some territories rely heavily on off-shore banking. Are there any implications for them? Will they be affected by EU legislation in this field? In November 1997 the European Commission published a report on unfair tax competition, proposing three separate measures to deal with this problem: the harmonisation of cross-border payment of interest and royalties made between associate companies; the harmonisation of cross-border interests on savings--the so-called withholding tax; and a political agreement between member states to refrain from any business taxation provisions harmful to the Community interest--a "code of conduct for business taxation". "Harmful tax competition" encompasses tax measures that distort the operation of the single market and, in particular, those which damage or distort the tax base and so lead to an excessive loss of tax revenues.
	In December 1997 a draft code of conduct was agreed at an ECOFIN meeting. A code of conduct group was subsequently set up, chaired by Dawn Primarolo, to examine tax measures throughout the European Union which may fall within the scope of the code, and to report back to ECOFIN. The 1999 Government White Paper, Partnership for Progress, states:
	"Member states with associated or dependent territories are committed, within the framework of the constitutional arrangements, to ensuring the principles of the Code are adopted in those territories".
	Given the status of British Overseas Territories, will the Minister outline how under this Bill the European Union code of conduct on tax measures will affect those territories?
	The Organisation for Economic Co-operation and Development (OECD) published a report in May 1998, Harmful Tax Competition, an Emerging Global Issue, which proposed that all OECD states should agree on a list of tax havens and act to ensure that any political or economic links with them, such as tax treaties, did not promote harmful tax competition. In June 2000 Bermuda and the Cayman Islands made a commitment to end harmful tax practices by 2005. Will the Bill in any way change the implications of this report for our territories?
	Crown dependencies, such as Jersey and Guernsey, are fiscally independent of the United Kingdom. That means that EU tax legislation does not extend to them. Will the Minister clarify the position of the European Union tax legislation regarding those territories which, under the Bill, would become British Overseas Territories?
	Furthermore, it is necessary for the Government to clarify the tax implications for BOTCs taking British citizenship and right of abode. Broadly, the United Kingdom charges tax on income arising in the UK, whether or not the person to whom it belongs is resident in the UK, income arising outside the UK which belongs to people resident in the UK, and gains accruing on the disposal of assets anywhere in the world which belong to people resident or ordinarily resident in the United Kingdom.
	However, the issue of status is more complicated than whether or not a person has British residence in the UK. There are questions that need to be addressed. Will the Minister outline the specific tax implications arising from the Bill for BOTCs who become British citizens under the provisions of the Bill and, first, take residency in the UK; secondly, become ordinary residents of the UK; thirdly, have resident status both in Britain and in one of the territories; fourthly, are resident in the UK but whose domicile remains in a territory? Will a citizen of a territory who has accepted British citizenship and whose domicile is Britain be subject to the same tax laws as a citizen who has taken British citizenship but whose domicile remains in that territory?
	On a more general level, is it possible for a British citizen from an overseas territory to live in the United Kingdom without being subject to UK tax regulations? Do the Government envisage an opt-out system? Would the rate at which tax is paid depend on the duration of the individual's residence in the United Kingdom? It is important that this House be made aware of the nature of the tax regimes and tax laws of each of our territories and how those structures will be affected by this Bill.
	The tax issues that I have raised are very complex. Will the Minister ensure that those British Overseas Territories citizens who become British citizens are made aware of the implications for their tax contribution arising from that change of status? I beg to move.

Baroness Amos: I thank the noble Baroness for her kind words. I hope that our positive working relationship, established over many years, will continue. I hope also that I shall be able to demonstrate that the amendments proposed by the noble Baroness are not necessary.
	Given the opening remarks made by the noble Baroness, Lady Rawlings, in respect of the responsibilities attached to becoming a British citizen, it might be helpful if I were to read a paragraph of the letter that I sent to the noble Baroness, distinguishing between rights, responsibilities and obligations.
	The offer in the Bill of British citizenship and, with it, the right of abode in the United Kingdom, is a free-standing offer made to all existing British Dependent Territories citizens who owe their status to their connection with a qualifying territory. It does not bring with it either obligations or benefits that pertain to residents of the United Kingdom, unless the holder chooses to take up residence here and subsequently builds up the relevant required period and/or contributes to the taxes and social security contributions in force in the United Kingdom. That applies to benefits, access to the health service, retirement pensions and fees for further and higher education.
	The department has prepared a guide to the most commonly asked questions about the offer of British citizenship. That guide addresses these and other issues raised at Second Reading, including benefits relating to the European Union. A copy of that paper has been placed in the Library of the House.
	The noble Baroness asked me a number of questions on, for example, the European code of conduct on tax measures. I need to draw the attention of the noble Baroness to her own amendment, which reads:
	"A person who claims British citizenship by virtue of this Act and who exercises his right of abode in the United Kingdom shall be subject to United Kingdom tax regulations".
	The amendment is about United Kingdom tax regulations, and I shall reply to it in that context. Nationality legislation does not traditionally address the rights and duties associated with British citizenship, and the Bill will have no effect on the operation of UK tax legislation.
	British citizens who reside outside the United Kingdom and the European Union are not subject to the direct tax regimes operated by member states, but current UK tax legislation will automatically apply to all British citizens who meet the required employment, residence and contribution thresholds. In other words, persons who become British citizens on commencement of the Act, and who exercise their right to live and work in the United Kingdom, will be taxed in the same way as all other British citizens. I repeat that they need to exercise their right to live and work in the United Kingdom before that has effect.
	The granting of British citizenship to British overseas territories' citizens is a matter for individuals, wherever they live. The EU code of conduct, which the noble Baroness mentioned, is a matter for discussion between governments. I should add that overseas territories are fiscally independent and repeat that all people who take up residence in the United Kingdom are subject to British tax regimes.
	I hope that in the light of my response the noble Baroness will feel able to withdraw her amendment.

Baroness Rawlings: I am grateful to the noble Baroness for her detailed reply. It seems that the most important aspect of the Bill will hinge on the definition of residence and residing. In this case, it has been spelt out clearly that the Bill will not affect citizens who reside outside the United Kingdom. I thank the Minister for her answer and beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Rawlings: moved Amendment No. 2:
	Page 2, line 29, at end insert--
	"( ) The rules governing European Union citizenship and member states of the European Community shall not extend to British overseas territories citizens who claim British citizenship."
	I shall also speak to Amendment No. 3, which has been tabled in my name. These first amendments are quite long, but the later amendments are quite brief.
	Amendments Nos. 1 and 2 are probing amendments, which seek to address the broad questions of the relationship between Europe and those countries which will, under the Bill, become British overseas territories; how the legal system of each territory will be affected; and the way in which the relationship of each territory and its citizens will be affected. It is important to clarify these issues.
	The Government have failed to address many of the issues that were raised in the White Paper Partnership for Progress and Prosperity: Britain and the Overseas Territories. It could be said that the Bill is more an exercise in political correctness than a serious attempt to give our territories a status that will benefit British Overseas Territories' citizens and address their concerns.
	An issue that has been neglected is the question of European legislation, including human rights legislation and the impact that it will have on British Overseas Territories' citizens who claim British citizenship. The White Paper made much of the complications that may arise in respect of Britain's human rights obligations. It states:
	"Overseas Territory legislation should comply with the same international obligations to which Britain is subject, such as the European Convention on Human Rights and the UN International Covenant on Civil and Political Rights".
	The Bill does not set out with any degree of clarity the mechanism through which Britain can comply fully with her obligations to the legislation, while granting its territories the status that they want--and one which we feel they deserve. Judicial corporal punishment still exists in some dependent territories, as does capital punishment. The use of the death penalty in the Caribbean would appear to be on the increase. Concerns about homosexual discrimination remain prominent issues.
	I know from my consultation with the territories that many BOTCs desire British citizenship. They find the procedure that they have to go through to visit Britain or Europe embarrassing and even insulting. The White Paper concludes:
	"There is a strong sense of grievance in many overseas territories that the right of abode in Britain was taken away from them. That is felt particularly strongly in St Helena. The residents of the overseas territories are proud of their connection with Britain, but are often puzzled that Britain appears not to be proud to have them as British citizens".
	It is right that a Bill to address these important concerns has at last been introduced on the Floor of our House, albeit belatedly. The Government can take no credit; they denied earlier discussion of an issue that means so much to so many. The Bill addresses little of the content of the 1999 White Paper, which makes this delay yet more frustrating for the territories' people.
	We do not want to oppose their demands in any way. We recognise that for many territories the acquisition of British citizenship is too important to allow some of the less appealing aspects of the implications of the Bill to halt its progress. We must all remain aware that some overseas territories' governments would not welcome British citizenship if it came with conditions attached, such as an obligation to introduce British or European tax rates and regimes.
	Will the Minister allay the fear held by many of the residents of our territories that a change of citizenship is not conditional upon such an obligation? Will she confirm that British citizenship will in no way threaten the rights of the people of these territories to determine their own constitutional relationship with the United Kingdom? Will the Minister say whether British Overseas Territories' citizens can have dual residence and dual nationality?
	The noble Baroness may be aware that the United Kingdom Government have imposed legislation on Caribbean islands such as the British Virgin Islands, Turks and Caicos and Cayman, to abolish the death penalty and making it possible for homosexuals to co-habit after the age of 21 with the consent of both parties. The impositions have been vigorously opposed on the islands.
	We require clarification as to how far the Government intend to enforce the suggestions in the 1999 White Paper, particularly with regard to the imposition of British law on its territories. Do the Government intend to impose further changes to the constitutions of our territories? If a territory is no longer dependent in status, I am sure that the Minister will agree that it should have a deeper level of independence.
	How far the Government intend to become involved in the domestic affairs of the overseas territories is an important issue to BOTCs. It is only correct and proper that the Government set out details of their plans with a greater degree of clarity.
	If the British Overseas Territories are truly to lose their dependent status surely it is only right that their constitutions are respected and a mechanism is put in place to make sure that a revision of their laws cannot be unduly imposed by external force. The Government have previously flagged up human rights issues in respect of which they claim to seek reform in some of the overseas territories. In January 2001 the UK scrapped laws making homosexuality a crime in Anguilla, the Cayman Islands, the British Virgin Islands, Montserrat and the Turks and Caicos Islands. The Government also seek reform of judicial corporal punishment, which remains on the statute books of the British Virgin Islands and Bermuda. Capital punishment is still available to the courts in Bermuda.
	Since Britain's overseas territories have unreformed laws regarding human rights it risks being in breach of important and fundamental international agreements, including the European Convention on Human Rights and the International Covenant on Civil and Political Rights. In addition, this exposes the UK to an avoidable contingent liability for costs and possibly damages. Overseas territories should enact the necessary reforms themselves, but in the absence of local action legislation could be imposed on the Caribbean territories. Any imposition of legislation by external forces carries the danger of setting a worrying trend which BOTCs would oppose vigorously.
	All along the Bill has held precious the aim to increase the rights of the BOTCs. It would be fundamentally wrong and against the spirit of the Bill for Britain, albeit indirectly perhaps, to impose upon BOTCs the same European legislation, including human rights legislation, as applies to their counterparts who reside in the UK. If this Bill provides for the imposition of such legislation it will contradict the very essence of, and motivation behind, the change in citizenship status. In such circumstances BOTCs are far from leaving behind their dependency.
	The Bill will give BOTCs the right to travel freely in the European Union. They will be British citizens. I have no doubt that the Minister has discussed at length the implications of the change of status for Britain's relationship with its overseas territories. However, many questions require clarification before the Committee. What representations has the Minister received from the UK's European partners regarding the change of status? Do the Government have any plans to give the overseas territories the same status as the other territories in the European Union?
	The UK is alone in Europe in having separate nationality status for the populations of its overseas territories. Danish, French, Dutch, Portuguese and Spanish nationality is indivisible and extends to all their territories. In particular, has the Minister discussed the question of the rights of citizens of British Overseas Territories to vote in European elections as EU citizens? If the BOTCs have such rights how will our European partners react to the non-reciprocal nature of the relationship? What will be the legal situation if a person has rights to British residency but his domicile is in a BOT?
	Will European Union or British law apply to a territory or its individual citizens? What provision will be made should a situation arise whereby a British citizen and a citizen of a British overseas territory who has opted out of British citizenship commit a similar crime? It cannot be right that one is dealt with under European or British law and the other under the law of that territory.
	If British citizenship is conferred on an individual does that affect the actions of a territory collectively? Will the citizen of a BOT who has claimed British citizenship and the right of abode be able to move freely between overseas territories? Such a situation may have vast implications for the financial and topographical status of each territory, yet the Bill fails to address those issues.
	I reiterate that it is not my intention to oppose the change of status of the territories. I am well aware of the importance that many people attach to the successful passage of this Bill. I seek only to hold the Government to a full and comprehensive debate of the issues. Many of the avenues for debate within the Bill were raised by the Government themselves in 1999. I hope that the questions that I have raised today can be answered by the Minister. It may be that not all of the questions relating to Amendments Nos. 2 and 3 can be dealt with today. It is only right that the passage of this Bill should be subject to a further White Paper the purpose of which is to clarify those issues which are left unanswered in the Bill.
	Furthermore, the Bill must be carefully debated by all the parties concerned. In a later amendment I shall seek to insert a provision in the Bill to ensure that it is ratified by the government of each territory to which it applies. The Minister will appreciate that that is only fitting for a Bill which provides a platform to implement a partnership of progress. I stress "partnership". The Bill is an important step towards the new partnership between Britain and its territories. It is important, therefore, to be clear about its practical implications regarding the degree of influence that it allows the European Union and Britain in British Overseas Territories. Furthermore, clarification is needed regarding the possible impact of the Bill upon the relationship between the territories and their citizens.
	As I have said on a number of occasions during the passage of this Bill, we on these Benches support the main thrust of this measure but believe that many of the details, which have not been thought through, may give rise to serious problems later if they are not clarified at this stage. I beg to move.

Lord Redesdale: I speak to this amendment simply in the spirit of thanking the noble Baroness for describing this as a probing amendment. On reading the amendments I was slightly concerned that, while they conferred the benefits of citizenship, they would remove some of the obligations that that would entail. I am also very surprised that today we do not see in the Committee many of the diligent noble Lords who speak on European matters, bearing in mind that Amendment No. 2 would mean that citizens of British overseas territories would have a different status. I would have opposed these matters had the noble Baroness not made clear that they are probing amendments. I look forward to the Minister's reply.

Baroness Amos: In response to the noble Lord, Lord Redesdale, I am grateful that some of those noble Lords who are very diligent in dealing with European matters are not here to ask me questions about the Bill.
	It may assist the Committee if I deal with the general point concerned with human rights with which the noble Baroness dealt at some length. I shall then go on to deal with the content of Amendments Nos. 2 and 3. A number of issues were raised by the noble Baroness. She also said that a number of issues remained unanswered. We need to distinguish between those issues which it is appropriate to deal with within the legislation and the huge raft of issues which relate to the application of the legislation on the ground. We have sought to deal with those issues by way of a paper which has been sent to the overseas territories. As I said earlier, that document has also been placed in the Library of the House. If having looked at the paper and Hansard there are any outstanding questions, I undertake to write to the noble Baroness.
	As to human rights, the Bill will fully comply with the United Kingdom's international obligations. The establishment and maintenance of high standards of observance of human rights is an important aspect of our relationship with the territories. The European Convention on Human Rights was extended to the territories in 1953, with their agreement. Since then, the core UN Human Rights instruments have been or are being extended in the same way. Most territories have fundamental rights chapters in their constitution which protect these rights.
	We have recently commissioned a review of these chapters and a model human rights chapter. These have been sent to the territories to feed into their constitutional review processes. In addition, we have served on foreign and commonwealth offices funding jointly with the Department for International Development a territory-wide project on the realisation of human rights for vulnerable groups; another on children and women's rights in the eastern Caribbean territories and the Turks and Caicos Islands; a major human rights conference in the Cayman Islands, to which all Caribbean territories were invited; and various individual programmes in other territories.
	I turn to Amendments Nos. 2 and 3. Amendment No. 2 would in effect deny to British Overseas Territories citizens the rights to freedom of movement in Europe to which they would be entitled as British citizens, and therefore take away an important advantage of British citizenship.
	By granting British citizenship to British Dependent Territories citizens we would in effect be lifting the limitations that that status currently carries with it, especially with regard to freedom of movement. The amendment places persons who as a result of the Bill have been granted British citizenship at a disadvantage compared with other British citizens when travelling, working, studying and living anywhere within the European Community.
	We are very keen to avoid that. We have made clear that the citizenship provisions of the Bill remove the very restraints, such as exclusion from EU free movement and established rights, which the amendment seeks to impose.
	I turn to Amendment No. 3. British Dependent Territories citizens who become British citizens as a result of the Bill will also be British Overseas Territories citizens. Their relationship with their territory of origin will not change, and we expect them to be treated no differently within that territory.
	The Bill will not alter the definition of overseas territory "belongership", which is a concept of territory nationality. That confers the right of abode, voting rights, the right to hold public office and in many cases to own land in the territory. This status is automatically acquired by the indigenous population and normally by those born in the territory to people settled in the territory. Under local immigration laws, "belongership" can be conferred on a discretionary basis on long-term residents who meet certain criteria. None of that will change as a result of the Bill.
	There will be no compulsion about taking up the benefits of British citizenship. Those who choose to do so will in any case retain their British Overseas Territories citizens status. The noble Baroness's proposed amendment risks creating doubt about the position post commencement, where, as matters stand, there is none.
	In the light of this explanation I hope that the noble Baroness will feel able to withdraw her amendment.

Baroness Young: Perhaps I may ask a question. My noble friend Lady Rawlings raised a number of very important constitutional questions. I recognise that the Minister may not be able to answer them all immediately. I also recognise that these are probing amendments. But one of the issues which very much worries people living in the dependent territories is exactly what their responsibilities and obligations are under the Bill.
	My noble friend pointed out a number of really very big issues. Of course one issue is human rights. Indeed, part of the answer about that is set out in the many pieces of paper. However, if one takes the two issues to which my noble friend referred--the death penalty and the decriminalisation of homosexuality--whatever one may think about them, and I am not here discussing their relative merits, they were actually imposed on countries. In the case of homosexuality, that was introduced against the wishes of the government, the opposition and virtually everyone in the territories. Once the Bill becomes law, will the whole panoply of what the overseas territories describe as "European political correctness" automatically be forced on these islands, or are we actually saying that there is a new relationship; that they are entitled to their point of view; and that they will not necessarily have these changes imposed on them? Of course other things will flow if that is the case.
	Both these measures were introduced by Order in Council through the Privy Council without any discussion in this Parliament, let alone anywhere else. I ask about this matter because I believe that we should have a very clear explanation of what actually is intended and what is meant. We need to know that, but, much more important, people living in the dependent territories need to be absolutely clear about their rights and responsibilities under this new set up. I am afraid that they are not set out in the Bill. If the noble Baroness cannot answer immediately, I should be very grateful if she would write to all of us on this matter.

Baroness Amos: In my response to the noble Baroness on Amendment No. 1, I set out very clearly the distinction between rights and responsibilities. I made it absolutely clear that we are here talking about the responsibilities of individuals who become British citizens. Once they become British citizens and have the right of abode in the United Kingdom, these matters apply to them if they take up the right of residence in the United Kingdom.
	The questions about the relationship of an Overseas Territories Government to the governments of the European Union are a different set of questions. I am quite happy to write to both noble Baronesses about those constitutional matters. But those matters are far outside the scope of the amendments tabled by the noble Baroness.

Baroness Rawlings: I thank the Minister for her reply and for her undertaking to write to us on any unanswered questions. I understand from what the noble Baroness says and also from what is stated in paragraph 22 of her notes that the provision applies to individuals but not to territories. We find this issue quite confusing. Therefore, we may well return to the matter on Report. Meanwhile, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	[Amendment No. 3 not moved.]

Baroness Rawlings: moved Amendment No. 4:
	Page 2, line 29, at end insert--
	"( ) This Act shall not affect any scheme adopted by a British overseas territory, before or after the commencement of this Act, in relation to the naturalisation of any person within that territory."

Baroness Rawlings: Amendment No. 4 is a probing amendment. The Minister said at Second Reading that the Bill sets out a new relationship between ourselves and our overseas territories and that the Bill also establishes the acceptance of new responsibilities on both sides. The amendment seeks to establish more fully that new relationship and the new responsibilities concomitant with it. It probes the question of how much control individual territories have over the process of naturalising citizens within their territories. As the Minister explained at Second Reading, those not yet currently holding a British Overseas Dependent Territories passport will need to apply in the first instance for a British Overseas Territories passport and then, should they wish, a British passport.
	I should be grateful for clarification on the following points. Do overseas territories currently make their own arrangements for naturalisation? Does that vary from territory to territory; and are the territories free to change this process?
	Before the Minister responds, I should explain what we are trying to achieve with the amendment. We seek to establish whether overseas territories, which will no longer be dependent territories, will, in losing their dependent status, gain any independence? I beg to move.

Baroness Amos: At the start of my remarks, perhaps I may confirm to the noble Baroness that the change of name from "dependent territories" to "overseas territories" is a change of name. The noble Baroness asked whether the territories will no longer be dependent. As I said in response to the debate on Second Reading, the Bill seeks to reflect the partnership which exists between ourselves and the overseas territories and also it seeks to recognise that the world has changed. It is no longer appropriate to refer to "dependency" in this way.
	Amendment No. 4 would preserve the arrangements whereby responsibility for registration and naturalisation as a British Dependent Territories citizen is delegated to Governors of overseas territories. In other words, it would preserve the territories' autonomy in this respect. The Bill makes no provision for change from the existing arrangements and will not affect the present arrangements in the overseas territories; nor are there currently any plans to make such a change.
	I believe that the amendment proposed by the noble Baroness is unnecessary and I ask her to withdraw it.

Lord Waddington: I am a little concerned about this matter. Can the noble Baroness help me on the following point? A person may have been living in Bermuda for a considerable time, but would not achieve Bermudan status. Bermudan status carries with it very real privileges; the right to live there and property rights which others do not possess. Presumably the Bill still delegates to the Governor the right to confer on a person citizenship of an overseas territory, but the Governor may still be conferring on that individual a form of nationality which carries no real rights in the territory because the territory, through its own domestic legislation, has stated in its wisdom that even though a person may be a citizen of a British overseas territory, he would not automatically qualify for Bermudan status. Is that correct?

Baroness Amos: I believe that I addressed this point in my response to Amendment No. 3, but it may be helpful to the noble Lord if I were to repeat it. The Bill will not alter the definition of overseas territory "belongership", a concept that covers territory nationality, to which I believe the noble Lord is referring. That confers the right of abode, voting rights, the right to hold public office and, in many cases, to own land in the territory. That kind of status is automatically acquired by the indigenous population, normally by those born in and settled in the territory.
	The amendment before the Committee seeks to preserve the arrangement whereby responsibility for registration and naturalisation as a British Dependent Territories citizen is delegated to the Governors of the overseas territories--the noble Lord's second point. Furthermore, this amendment would preserve the territory's autonomy, but I think it is important that noble Lords understand that no provision in the Bill seeks to change the arrangements which currently obtain. That is why the amendment is unnecessary. There are no plans to make such a change. The Bill does not alter the existing arrangements.

Lord Waddington: It is hoped that it would never happen in practice, but in theory a Governor, using his delegated powers, could grant a person overseas territory citizenship and then, under a later provision contained in the Bill, that person would appear to qualify for British citizenship and could be granted such citizenship by the Secretary of State. The effect of that person having been granted British citizenship by the Secretary of State surely would mean that that person would then have the equivalent of Bermudan status. One could hardly say that a full British citizen would then not have the right to live in the territory.

Baroness Amos: I think that the noble Lord has forgotten that, under the terms of the Bill, the rights are non reciprocal. Thus although citizens of the overseas territories have the right to British citizenship, British citizens in the United Kingdom, along with citizens of the European Union, do not have reciprocal rights.

Lord Waddington: However, in the case that I have posited, a full British citizen might be in the position of not having the full rights of a citizen in the territory in which he lives, and which founded his application for British citizenship. Is that what the Minister is confirming?

Baroness Amos: I should like to try to understand the point being made by the noble Lord.

Lord Waddington: If the Governor can grant Overseas Territory citizenship to a person who, because of domestic legislation does not hold Bermuda status, then the Secretary of State, on the basis of that Overseas Territory citizenship, could grant British citizenship and therefore a full British citizen, by virtue of his residence in an overseas territory, may not hold the full rights of citizenship in that territory.

Baroness Amos: That is the logic of the noble Lord's point. However, I think that it is important to remember that that is why we have made clear in the legislation that this is at the discretion of the Secretary of State. It is precisely so that these kinds of cases can be looked at on an individual basis by the Secretary of State.

Baroness Rawlings: I thank the Minister for her explanation: a change of name, but not in meaning. I believe that is what she has said. That is interesting because it returns to what we put forward at the beginning. I was under the impression that the central point of the Bill was to grant British citizenship and rights of abode as soon as the Bill passes through to any of the citizens of the British overseas territories. I believe that there is a major change in the procedure, because at present those citizens do not hold British citizenship or the right of abode. I hope that I am correct in saying that.

Baroness Amos: That is absolutely correct, but the noble Baroness referred specifically to the use of the term "dependent" and whether the granting of citizenship would then cause the territories to become independent. The Bill specifically addresses citizenship; it does not concern dependence or independence. I think that it is important that we distinguish between the part of the Bill which concerns the change of name from British Dependent Territory to British Overseas Territory--a name that we have already been using--and the grant of rights of citizenship which carries with it the right of abode. These are two separate matters.

Baroness Rawlings: I thank the Minister. We should like to consider the matter further. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	[Amendments Nos. 5 to 7 had been withdrawn from the Marshalled List.]
	Clause 3 agreed to.
	Clause 4 [Acquisition by British overseas territories citizens by registration]:

Baroness Rawlings: moved Amendment No. 8:
	Page 2, line 35, leave out "Secretary of State" and insert "Governor of the British overseas territory to which the application refers"

Baroness Rawlings: In speaking to Amendment No. 8, I ask whether it is the Government's intention to allow these newly "independent" territories to confer citizenship on whomever they choose?
	I should be interested to learn what responsibilities the Government envisage for the Governors of the overseas territories--a point referred to earlier by my noble friend Lord Waddington--after the commencement of the Act. If an overseas territory chooses to grant British Overseas Territories citizenship to an individual, will the Secretary of State need to endorse every new citizen? We on these Benches feel that this could be very demeaning for the new British Overseas Territories citizens. I beg to move.

Lord Redesdale: While we on these Benches do not believe that there will be a flood of people being given citizenship, especially in countries such as the Bahamas, I should like to ask the Minister one question. If the amendment was agreed to, it would raise the spectre that the governor would be responsible to the Home Office and not to the Foreign and Commonwealth Office. Is it the case that the Governors of the overseas territories will be still seen as answerable to the Foreign and Commonwealth Office, or will the Home Office take responsibility for the Governors?

Lord Waddington: I cannot support the amendment. I hope that the noble Baroness and the Minister will agree that the clause goes a long way towards meeting the mischief which I feared could arise under the Bill. Unless we have a clause of this nature, we could have a governor following a policy which would result in a lot of people obtaining British Overseas Territories citizenship who were not "belongers" in the territory. They would then ostensibly qualify for full British citizenship. Their applications would then come before the Secretary of State and he or she would say, "This is a nonsense. We cannot possibly grant this person British citizenship. He should never have been granted British Overseas Territories citizenship because he is not a "belonger" in the territory". We could not possibly delegate to the Governor the right to grant British citizenship, which may be on the back of a wrongly granted citizenship of the British Overseas Territories. That is the way I look at it. Am I right?

Lord Rooker: I hardly need to rise following the comments of the noble Lord, Lord Waddington.
	Amendment No. 8 raises an important point of principle. As the Committee will know, nationality is often complicated and is sometimes an emotional matter. Some people will inevitably attempt to acquire British Overseas Territories citizenship status after commencement as a stepping stone to British citizenship, and with it the right of abode in the United Kingdom. We need to ensure that those who qualify do so within the provisions of the Bill.
	We believe that it is right that the grant of British citizenship after commencement should remain a matter for British Ministers answerable to Parliament, as it is now for all applications for British citizenship under the British Nationality Act 1981. This enables us to decide British citizenship applications not only on the basis of technical expertise but also on the geographical and emotional detachment which sometimes may be lacking in governors.
	We are also keen to ensure that applicants are, for instance, of good character, and that we generally maintain consistency of decisions. We believe that that would best be achieved by having a single decision-making authority. For those reasons, I would ask the noble Baroness to withdraw her amendment.
	As to the question raised by the noble Lord, Lord Redesdale, collective responsibility is the order of the day. We have used throughout British Ministers, and that is the way that it will be done.

Baroness Rawlings: I thank the Minister for that answer. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Redesdale: moved Amendment No. 8A:
	Page 2, line 35, leave out "may" and insert "shall"

Lord Redesdale: The amendment raises the spectre of the "may" and "shall" argument, an issue that has been raised many times. However, this is a probing amendment; I do not expect the Minister to accept it. I am bringing it forward with a specific intention in mind.
	I tabled a number of amendments which, using sneakiness and guile, I managed to get the Public Bills Office to accept before it spotted their inadequacies, when they were immediately thrown out or withdrawn. The purpose of those amendments was to institute British citizenship for British overseas citizens, a group of people which has been specifically and carefully excluded from the short Title of the Bill. As this has been an opportunity lost, I plan to bring forward a Private Member's Bill at a later stage in an attempt to rectify the situation. However, that is a matter outside the terms of the amendment and I obviously understand that the Minister will not respond to it. I beg to move.

Lord Rooker: As the amendment has been moved, I shall respond to it. I understand why it is in the Marshalled List. Obviously I shall not comment on the plans of the noble Lord in respect of his proposals for future legislation.
	Amendment No. 8A would limit the discretion of the Home Secretary to refuse to register people seeking registration as British citizens subsequent to the commencement of the legislation. As I have said before, some people will inevitably attempt to acquire British Overseas Territories citizenship status after commencement as a stepping stone to British citizenship, and with it the right of abode in the United Kingdom. We need to ensure that those who qualify do so within the provisions of the Act.
	As I said before, immigration policy is not in the control of the British Government. This is a devolved responsibility to locally elected governments, who have different considerations in mind when establishing and operating such practices. Limitation of the Home Secretary's discretion could potentially open the way for backdoor entry to British citizenship. In the light of that explanation, I hope and trust that the noble Lord will withdraw his amendment.

Lord Redesdale: I thank the Minister for responding in the spirit in which the amendment was moved. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	[Amendments Nos. 9 and 10 had been withdrawn from the Marshalled List.]
	Clause 4 agreed to.
	Clause 5 agreed to.

Baroness Rawlings: moved Amendment No. 11:
	After Clause 5, insert the following new clause--
	"COST OF CLAIMING CITIZENSHIP
	The Secretary of State shall by order require that in each British overseas territory the cost of claiming British citizenship, either by nationality registration, naturalisation or the cost of issuing passports, shall not be so prohibitive as to prevent British overseas territory citizens from exercising their right to British citizenship conferred by this Act."

Baroness Rawlings: The amendment relates specifically to average income per head, which varies significantly throughout the overseas territories. It would be highly undesirable for a British Overseas Territories citizen to be denied the opportunity to claim British citizenship due to the prohibitively high cost of doing so.
	The noble Baroness, Lady Amos, informed the House that:
	"The change in citizenship status will occur automatically for most people and there will be no costs to cover. However, some cases may attract a fee... I confirm to noble Lords that passport fees will be charged on the basis of the fees set by the Passport Agency world-wide. Therefore, the price will not vary".--[Official Report, 10/7/01; col. 1035.]
	Any British overseas territory citizen who wishes to benefit fully from the conferral of British citizenship by this Bill will, I assume, wish to acquire an appropriate passport. By "citizens who wish to benefit fully", I mean those citizens who wish to enjoy the right to freedom of movement throughout the European Union and so on. Yet the cost of doing so will mean different things to different people in different territories. Let us take, for example, two territories at the extremes of prosperity. The GDP figure in 1999 for the British Virgin Islands was £17,226; in St Helena it was £2,536.
	Many existing British Overseas Territories citizens feel a sense of injustice that they cannot travel freely through the European Union; others will welcome the opportunity to visit Britain and Europe to gain valuable skills that they cannot acquire at home. In the White Paper, Partnership for Progress and Prosperity, we are told that the Government anticipate that some people may like to come to Britain for training and work experience, and will be welcome. My noble friend Lord Waddington raised the issue of work experience as a means of achieving more of a level playing field in the employment market.
	It is clear that we must ensure that every British Overseas Territories citizen who wants both the identity of a British citizen and the more tangible advantages of this identity can acquire the necessary documents and registration. I should appreciate some assurance that this will be the case. I understand that they will not need a work permit in the UK or in the European Union, but that they will have to abide by all the European Union rules. I beg to move.

Lord Redesdale: I merely want to ask about the situation of those citizens of Montserrat who are living in this country. They are presently suffering financial hardship and the DfID is providing aid to Montserrat. Who will provide the cost of their travel documents?

Baroness Amos: The amendment would have the effect of limiting the flexibility of both the territories and the British Government to set charges that reflect the true costs of registration and the issuing of passports.
	British Dependent Territories citizens who become British Overseas Territories citizens will automatically become British citizens with a right of abode in the United Kingdom on the commencement of the provision in Clause 3. Most residents of the territories will not incur additional costs unless they apply for a British passport. The cost of a British passport is the same world-wide when issued from a British embassy or high commission. The fee is governed by the consular fees regulations. Overseas territories citizens will in no way be disadvantaged over other British citizens who acquire their passports overseas.
	Perhaps I may remind the noble Baroness that passport fees are the same in the UK for whichever British citizen applies for a passport here. There is no differential that is dependent on where a person lives or on his or her income. We do not distinguish between different groups of applicants according to ability to pay.
	The noble Lord, Lord Redesdale, asked specifically about Montserrat. It is cheaper to obtain a British passport in the UK than it is to obtain one in a British embassy or consulate. As I understand it, citizens of Montserrat are not adversely affected by the legislation. I hope that in the light of that explanation the noble Baroness will withdraw her amendment.

Baroness Rawlings: I thank the Minister for her reply, but we are disappointed. I hoped that the Minister might be able to agree to the amendment and that the humanitarian side of the Government might play a part. The situation is now very different from that of a British citizen residing in the UK who applies for a passport, given the new provisions regarding British Overseas Territories. The amendment is important: the disparities that I have mentioned are grossly unfair and we should like the Bill to be amended. I therefore wish to seek the opinion of the Committee.

On Question, Whether the said amendment (No. 11) shall be agreed to?
	Their Lordships divided: Contents, 69; Not-Contents, 124.

Resolved in the negative, and amendment disagreed to accordingly.

Baroness Young: moved Amendment No. 11A:
	After Clause 5, insert the following new clause--
	"BRITISH OVERSEAS TERRITORIES: RIGHTS OF BRITISH CITIZENS
	Any person who qualifies to be recognised as a British citizen under this Act is entitled to receive such rights and benefits as if he were settled in the United Kingdom."

Baroness Young: This is a probing amendment. It is widely drafted and I recognise that the point to which I wish to draw attention is not stated as clearly as it should be. Nevertheless, the issue is extremely important. I hope that it will receive sympathetic support from all sides of the Committee.
	A matter that has been raised consistently with me by people from British Overseas Territories is the whole question of student fees. They presently have to pay the overseas student rate, which is considerably more than the home student rate.
	I have travelled extensively in the Caribbean. Many of the islands have extremely good educational institutions, and there is also the University of the West Indies. However, leaving all that aside, very many people from the Caribbean, especially those from dependent territories, want to study in British universities or in British institutions of higher education of one sort or another. It is terribly important in today's world that they should have the opportunity to get the essential qualifications that they require in order to get a job back home, let alone anywhere else. We could provide such an opportunity by making it possible for them to attend British universities on a home-student's-fee basis, which is not possible at present.
	When I spoke at Second Reading, I carefully questioned the noble Baroness about what actual obligations and responsibilities would flow from the Bill now before the Committee. Quite frankly, although the legislation will confer British citizenship--which is very important; and I do not in any way underestimate that--one of the most worrying aspects is that it does not seem to give those concerned any of the kind of rights that they would have were they to be British citizens living in this country. That is how I understand the position, but this is perhaps where I need the help of the noble Baroness.
	I can see that the position could be quite difficult as regards many matters; indeed, I previously raised the question of taxation, representation in Parliament, and so on. One could go on to cite innumerable matters, some of which my noble friend Lady Rawlings mentioned when dealing with her earlier amendments. But the question of education seems to me to fall into a completely different category by itself. I believe that I am correct in saying that the noble Viscount, Lord Colville, spoke at Second Reading about the situation of overseas students in, for example, St Helena. There is very little work on the island and very little opportunity to gain the kind of education qualifications that these youngsters need to get a job anywhere else in the world, let alone gaining the kind of professional qualifications that they need to improve the lot of their own people.
	We are dealing with an extremely important issue. I hope that the Government will feel that it is worth considering this matter as a sort of sui generis issue. There are many of us--I believe that I speak for probably everyone here--who feel that it is most important to keep the British link with the British Overseas Territories. I have in mind the Caribbean in particular, but there are other territories. If students come to our universities, there is no doubt at all that that will maintain the link. Of course, the alternative, especially for the Caribbean, will be for those students to apply to both Canadian and American universities, as some of them do at present. Anyone who travels in the Caribbean knows how powerful the influence of those universities can be. I am not saying that it should not be so. But if we believe, as I think we do, that our British universities offer a first-class educational opportunity, we ought to consider those in our overseas territories who will receive British citizenship under this Bill. Once they have received that, they should know that they really have something that will be of huge benefit to their young people. I beg to move.

Lord Waddington: I cannot support the specific amendment. However, I lend support to my noble friend's plea that we should consider again the question of student fees. In the old days there was a common nationality. We were all citizens of the United Kingdom and colonies. A mockery was made of the common citizenship by the immigration Acts of the 1960s, with some citizens of the United Kingdom and colonies having rights and other such citizens having fewer rights. We tried to get rid of the anomaly by the British Nationality Act at the beginning of the 1980s.
	We do not want to return to the mess we got into over the citizenship of the United Kingdom and colonies, granting everyone British citizenship but saying that some are better British citizens than others and that some have rights which other British citizens do not have. It would be a very unsatisfactory outcome if we passed this important Bill conferring important rights on people who live in the overseas territories. We must avoid saying, "You will not be treated in the same way as other citizens when you come to Britain". Therefore, while I do not support the amendment, I hope that before the Bill becomes law the Government will consider again the matter of student fees.

Lord Beaumont of Whitley: I support the plea of the noble Baroness, Lady Young, and the noble Lord, Lord Waddington. It is important to give these people the possibility of education and gaining qualifications.
	The Committee will know that I often speak on behalf of the citizens of St Helena. I am sure that I do so on this occasion. It may be reasonably easy for citizens of the Caribbean to get education and gain qualifications. It is almost impossible to do so in St Helena. Therefore, it is important that the Bill should not pass into law before we have arranged that British citizens in these territories have rights to get the same education and training as those resident in this country.

Baroness Rawlings: I support my noble friend Lady Young on this amendment. I had flagged this issue at Second Reading.
	For a UK student the sum is approximately £4,300 for the four year period. For an overseas student the amount is over £54,200. The difference is enormous. We on these Benches fully support my noble friend.

Baroness Amos: The effect of the amendment would be to give all British Dependent Territories citizens from qualifying territories who are granted British citizenship under the provisions of the Bill the right to all benefits of that citizenship without meeting UK residency requirements.
	Entitlement to the domestic rate for education fees and to other benefits is based on residency qualifications not nationality. Although the education fee structure is governed by the Education Fees and Awards Regulations 1977, because of the high degree of autonomy enjoyed by universities and colleges, it is open to them to interpret always the regulations as they choose.
	I think that it would be wrong to give the same rights and benefits automatically to a British citizen from an overseas territory as are enjoyed by persons who are resident in the United Kingdom. The effect of the amendment would be to place British citizens from the territory who do not take up the rights of abode in the United Kingdom in a better position than British citizens living here. They would enjoy access to all benefits but would not be subject to British contribution payments for taxes.
	The Bill makes no distinction between British citizens provided that they first meet the residency requirements. The removal from immigration control and the grant of right of abode in the United Kingdom for British Dependent Territories citizens from qualifying territories as a result of this Bill will make it easier for them to satisfy those residency requirements.
	We would not be consistent in our treatment of British citizens if we accepted the amendment. I accept the noble Baroness's recognition that the amendment is somewhat wider than the intention. I ask the noble Baroness, therefore, to withdraw the amendment.

Lord Beaumont of Whitley: Before the next stage of the Bill, perhaps the Minister will consider again her reply that it is up to the academic organisations to interpret the regulations. It does not sound a satisfactory answer. We would like some assurance from the Government that the need for education and training of those who have been denied them in the past because of the implications of lack of citizenship will now be met.
	I realise, as the noble Baroness, Lady Young, acknowledges that this is not the right amendment. However, before the Bill is passed we should have some assurance from the Government on this important matter.

Baroness Amos: It may be helpful if I say to the noble Lord that the position with regard to education fees and awards is the reality; it is what we are living with.
	I come back to the issue of consistency. We support overseas territories in a number of other ways. The noble Lord referred to the need for education and training. At Second Reading, the noble Baroness, Lady Young, raised the issue of training for civil servants from the overseas territories and I replied to her on that point. We support citizens from the overseas territories in a number of ways with regard to training. That is a separate issue from what should be put on the face of the Bill.

Baroness Young: I thank my noble friend Lord Waddington, my noble friend Lady Rawlings and the noble Lord, Lord Beaumont, for their support.
	As I indicated, I shall withdraw the amendment. I do not think that it is appropriately drafted. However, I was disappointed with the Minister's reply. She says in effect that only those who are formally resident in this country can have the home student fees. It is suggested that universities might be able to do something to help students from overseas. Of course, they can and they do. But let us picture a prospective student in St Helena or some small island in the Pacific who would like to come to the United Kingdom. The idea that he would be able to identify a university and then obtain a scholarship as a result appears to be most impractical. He may be lucky, and the governor or a friend may provide help. However, it is not a very practicable proposition. I am not sure what is meant by the argument that we cannot help those people because, by coming here, they would receive the benefits of the country. I suppose that we mean that they would be able to use the health service without paying tax. If I am wrong on that, I stand to be corrected.

Baroness Amos: Perhaps I make may a point regarding consistency which may help the noble Baroness. If I, as a British citizen, chose to live in another country, I would not have the same rights as I would have as a resident in the United Kingdom. I would give up those rights if I lived elsewhere. If I then returned to the United Kingdom, depending on the length of time that I had been away, I should have to requalify by making contributions and paying taxes in order to have the right to access benefits.
	The noble Baroness's amendment would give people access to those benefits without a right of residence. That cannot be fair. We cannot say that the granting of British citizenship to people who currently reside in overseas territories will provide them with access to benefits which British citizens do not have until they qualify.

Lord Waddington: But surely there is a fallacy in the argument advanced by the noble Baroness. In the old days, despite the fact that overseas students were not residents, they benefited from the same fees as did people who were resident. Therefore, if we were to grant to those British citizens the benefit which is sought by my noble friend, we should be returning to the situation which appertained in the 1970s.

Baroness Amos: That is not the case. The entire situation has changed, and it is not a matter of returning to a position that once existed. For example, on reaching university age, the children of a British citizen living abroad would have to return to this country and qualify in terms of a resident's qualification before gaining access to home fees. That is the current situation.

Lord Beaumont of Whitley: The analogy produced by the Minister is not a fair one. She is comparing citizens who voluntarily go abroad and who must return to this country in order to obtain entitlement with people who are born in, and are natives of, their own country. Such people are in a totally different situation because they have not chosen to be in that country; the situation has been thrust upon them.

Baroness Amos: Perhaps I may confirm that this legislation grants a right of abode as well as a right of citizenship.

Lord Waddington: I invite the noble Baroness to reconsider the matter. I may be hopelessly wrong, but I believed that all the controversy which occurred over the past few years arose from the fact that in the old days overseas students did not pay different fees for their time at university from people who were resident here. Therefore, we would be returning to the situation which used to appertain.

Baroness Young: I believe that there is concern in the Committee in relation to this matter, and I hope that the noble Baroness, Lady Amos, will look at it again. The argument that is put forward is always one of consistency. It is a good administrative argument which aims to introduce tidiness.
	Perhaps I may give an example of the type of situation to which I refer. Let us suppose that a young man or woman living in St Helena is clever and would like to qualify as a doctor. Today, that would be a very expensive proposition to undertake on home student fees, but it would be even more expensive on overseas student fees. The noble Baroness is saying, "All right, you can qualify as a doctor, but you must come and live in Britain". One may well argue that the doctor was needed most not in Britain--although I believe that we do need plenty of doctors--but in St Helena, to which the student would like to return.
	Under those circumstances, in a country where there is no university and no prospect of qualifying for that type of job, is my proposition unreasonable? In any event, we cannot possibly be talking about an enormous number of cases or about vast sums of money. I forget the exact population of St Helena, but I believe that it is well under 10,000. Therefore, a very small number of people would be involved. However, we are saying that we shall deny to people in those places scattered around the world an opportunity to receive higher education.
	This matter appears to be most important not only for the benefit of young people in the overseas territories but for anyone who cares about education and about helping people to climb the educational ladder, from wherever they may come. I recognise that my amendment is not correctly drafted, but I give notice now that I shall return to this matter at a later stage. In the meantime, I hope that the noble Baroness, Lady Amos, will consider what has been said this afternoon. I should be more than happy to talk to her further if there were a prospect of reaching an agreement whereby a measure such as this might be included in the Bill. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	Clause 6 [Repeals]:
	On Question, Whether Clause 6 shall stand part of the Bill?

Lord Hylton: In the interval between this and the next stage of the Bill, will the Minister be good enough to consider the case of, say, an American or EU citizen who is resident in Great Britain and who, therefore, presumably is entitled to higher and further education at the lower rate? Is such a person not being preferred to British citizens who happen to live in an overseas territory? If that is the case, it appears to be a serious anomaly and is relevant to what has already been said.

Baroness Amos: Having listened to the noble Lord, Lord Hylton, I believe that what is being proposed is outside the scope of the legislation as it currently stands. However, I shall be happy to talk to the noble Lord about this matter after the conclusion of our Committee stage.

Clause 6 agreed to.
	Clause 7 [Short title, commencement and extent]:

Baroness Rawlings: moved Amendment No. 12:
	Page 3, line 14, at end insert--
	"( ) The provisions of this Act shall not come into force, in a qualifying territory, until such a time as it has been ratified by that territory."

Baroness Rawlings: In speaking to Amendment No. 12 I shall be brief. We shall be interested to learn whether the Government intend the Act to come into effect immediately the Secretary of State has made a commencement order or whether the Act will also need to be ratified by each territory. The need for the Act to be ratified by the territories would seem to be in keeping with the "partnership principle" that is so much a part of the thinking that lies behind the Bill. I beg to move.

Lord Redesdale: I have spoken to representatives from most of the dependent territories, who are very happy with the fact that the legislation will come before Parliament. I hope that the amendment is not intended to delay the implementation of the legislation.

Baroness Amos: British nationality is exclusively a matter for Parliament at Westminster; it is not for the overseas territories to ratify British legislation. From the date of Royal Assent the changes in nomenclature will automatically take effect. From the date of commencement of the provisions relating to citizens, British overseas territories citizens will automatically become British citizens.
	I can confirm the point that was made by the noble Lord, Lord Redesdale, and that we have consulted widely. I am confident that the Bill will be widely welcomed in the overseas territories. On that basis, I ask the noble Baroness to withdraw her amendment.

Baroness Rawlings: Our aim is not, as I have said several times, to delay the Bill. We feel, however, that this matter is important in relation to self-determination, which the Minister has mentioned so many times. She gave an interesting answer but we feel that this is an important amendment, which should be included in the Bill. I wish to test the opinion of the Committee.

On Question, Whether the said amendment (No. 12) shall be agreed to?
	Their Lordships divided: Contents, 60; Not-Contents, 123.

Resolved in the negative, and amendment disagreed to accordingly.

Baroness Rawlings: moved Amendment No. 13:
	Page 3, line 18, at end insert--
	"( ) Within twelve months of the commencement of this Act, and annually thereafter, the Secretary of State shall lay a report before both Houses of Parliament setting out--
	(a) the number of British overseas territories citizens taking up British citizenship,
	(b) the number of disputed claims,
	(c) the number of British overseas territories citizens taking up right of abode in the United Kingdom,
	(d) the cost per applicant of nationality registration,
	(e) the number of new applicants seeking British overseas territories citizenship per territory, and
	(f) any other such information in relation to this Act as he shall think fit."

Baroness Rawlings: I am sure that the House would welcome a report on the number of new British citizens from the overseas territories. As it is, as yet, impossible to know exactly how many people will benefit from the provisions of the legislation, it seems appropriate that we should find out how many people have been able to acquire British citizenship within a year of commencement.
	Similarly, it seems appropriate that the House is made aware of any cases in which an individual's claim to British citizenship is in dispute. That would enable the House to see how effectively the framework for nationality registration and passport issuing is operating, and whether there are a significant number of claims which appear sufficiently tenuous to warrant a dispute.
	One of the most desirable aims of this Bill is to enable British citizens in overseas territories to come to the UK, we thought, for education, training and work experience. Those who expressed a particular interest in further education, which we discussed on an earlier amendment, will, I am sure, welcome any information regarding the number of British citizens who have been able to pursue higher education courses in the United Kingdom. Additionally, it is important that we know the extent to which emigration is seen as a viable option within the overseas territories.
	To follow on from what I have already said about the cost of claiming British citizenship, I should be interested to know what is the cost of acquiring a new passport once the system is up and running. It would be helpful to know also whether the individual territories believe that the cost of acquiring British citizenship is in any way prohibitive.
	In answer to the question raised by the noble Lord, Lord Waddington, the noble Baroness, Lady Amos, informed the Committee that the purpose of requiring an individual to claim British overseas territory citizenship, before being permitted to claim British citizenship, is to ensure that a filter operates to prevent illegal immigrants using the new legislation as a stepping stone to the United Kingdom. Registration or naturalisation as a British overseas territory citizen will act as such a filter. Whether that will prove an effective means of preventing those without a legitimate claim to British citizenship from acquiring it remains to be seen. Are the BOTs allowed to give citizenship to whomever they want? What are the rules? Once you are a BOT citizen, can you automatically become a British citizen?
	The Bill has commanded widespread support on all sides of the Chamber. I understand that it marks a significant step in the evolution of the new relationship based on partnership between Britain and overseas territories. Therefore, I should be interested to hear how the provisions of this legislation have enabled further progress to be made in the areas of human rights, financial regulation and environmental conservation as described in the White Paper of March 1999, and in areas as the Government see fit. Furthermore, what is the right of appeal for someone who has been rejected? I beg to move.

Baroness Amos: Amendment No. 13 would commit us to producing and publishing annual progress reports. We shall, of course, want to monitor implementation of the Bill when it becomes an Act.
	Some of the statistics requested in the amendment--namely, the number of people applying for British passports and for British overseas territory citizenship status after commencement--are relatively straightforward to provide. However, others, such as recording the number of disputed claims, will be less easy as we shall first need to decide whether such claims refer to nationality registration or passport applications, and to agree on the definition of what constitutes a disputed claim.
	It will not be possible to provide figures for the number of people who exercise the right of abode in the United Kingdom. The new British citizens created by the Bill, who arrive here with full British passports, will not be subject to immigration control. They will enter the country as British citizens. Therefore, no data will be collected in relation to that.
	The date of commencement of the citizenship provisions of the Bill will be set by statutory instrument once satisfactory arrangements are in place for processing passport and nationality applications. We shall ensure that those include arrangements for recording numbers where it is possible to do so and that those figures are made available to noble Lords.
	It is not appropriate that this should be on the face of the Bill and I hope that, against the background of my explanation, the noble Baroness will feel able to withdraw the amendment.

Baroness Rawlings: I thank the Minister for her reply. We may well return to this matter at a later stage because it is quite important. Meanwhile, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	On Question, Whether Clause 7 shall stand part of the Bill?

Baroness Young: Perhaps I may raise with the noble Baroness, Lady Amos, a question which I raised on Second Reading. She was good enough to write to me on most of the issues which were raised but the point to which I refer is important. What consultation has there been with the other independent countries of the Caribbean, in particular about the provisions of this Bill, because both the other countries of the Caribbean and the overseas territories are linked closely together in that part of the world?

Baroness Amos: As I explained in my previous answer, there has been a great deal of consultation with the overseas territories themselves. The independent Caribbean countries are aware that we want to put in place this legislation, especially as that was flagged in the 1999 White Paper. However, there has been no formal consultation as such with the independent Caribbean countries.

Baroness Young: Is it not a matter of concern that those living in the overseas territories who will now acquire British citizenship will be in a completely different position from those in the other countries of the Caribbean who, of course, would not automatically have British citizenship should they wish to come and work in this country?

Baroness Amos: We are talking about the difference between the independent Caribbean countries and the overseas territories. The relationship is quite different.

Clause 7 agreed to.
	Schedule 1 [British citizenship and the British overseas territories]:

Baroness Rawlings: moved Amendment No. 14:
	Page 4, line 19, at end insert--
	"( ) After subsection (2) there is inserted--
	"(2A) Citizenship conferred under subsection (2) on any infant found abandoned in a qualifying territory shall not subsequently be a ground for conferring British citizenship on that infant's parents, guardians or siblings unless they qualify in their own right.""

Baroness Rawlings: We believe that it is important to take into account all eventualities. We welcome the provision for infants found abandoned within a British overseas territory. However, it is important to be clear about the conditions of a legitimate claim to British citizenship. If an abandoned infant were to be reclaimed by his natural family or taken into the care of a guardian, under this legislation there is no sufficient grounds for anyone other than the infant to claim British citizenship.
	British overseas territories citizenship, under the current regulations, can be acquired only as a result of a connection with one or more territories; for example, by birth, adoption, naturalisation or descent. It should remain the case that an individual can claim British citizenship only if he qualifies in his own right. I beg to move.

Lord Rooker: We do not believe that there is a need for Amendment No. 14. The circumstances in which a child found abandoned in an overseas territory would be deemed to have acquired British citizenship are clear. If it subsequently emerged that the child was born of parents who were not themselves settled in the territory or British citizens at the time of the birth, the child would no longer be entitled to the nationality it had been deemed to acquire.
	Parents, guardians and siblings will indeed have to qualify for British citizenship in their own right. That is clear from the Bill as introduced, and from the provisions of the existing nationality legislation. If the parents come forward and are shown not to qualify, they could, of course, put at risk the child's own claim. In the light of that explanation I hope that the noble Baroness will withdraw her amendment.

Baroness Rawlings: I thank the Minister for his reply and explanation. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Rawlings: moved Amendment No. 15:
	Page 6, line 34, at end insert--
	"( ) In the event of a dispute over an individual's claim to British citizenship, an appropriate framework shall be set up by the Secretary of State, in consultation with the overseas territory concerned, in order to resolve such a dispute.
	( ) The final decision in relation to any dispute shall lie with the Governor of the territory concerned.""

Baroness Rawlings: In relation to this final amendment we would like some clarification. While the criteria that must be satisfied for the acquisition of British citizenship are clear, I do not doubt that some cases will arise where an individual's claim to British citizenship is far from straightforward. I believe that there should exist, from the commencement of this Act, a framework for settling such disputes. That framework should be common to all the British overseas territories. For that reason the Secretary of State should work in consultation with the territories to ensure that conditions are the same throughout. The final decision in relation to any dispute shall lie with the governor of the territory concerned.
	As I have already said, it is desirable that the governor of a particular territory has the capacity to decide who is eligible to claim British overseas territory citizenship and subsequently British citizenship. I believe that this amendment satisfies the notion of partnership in every sense. If the framework for settling disputes is formulated by both the Secretary of State and the overseas territories, it seems fitting that the governor of the territory to which the application refers remains the arbiter in individual cases.
	Many of the problems raised by this Bill are a direct result of the Government's omission of several areas covered by the White Paper. Important questions remain unanswered. The Government want to remove any traces of the notion of dependants, yet are unprepared to state explicitly what the granting of British citizenship will mean in practical terms for the people of the overseas territories. The redefinition of the UK's relationship with the overseas territories cannot be limited to a change of name and the granting of British citizenship to the British Overseas Territories' citizens. I look forward to hearing clarification of the implications of these important changes.
	We support this Bill and I am grateful, as I said earlier, to the Minister for all her letters and helpful notes. However, I repeat that we are deeply concerned that in reality this Bill is just politically-correct rhetoric, the only change being in name, as the Minister said. We feel that these overseas territories are not the "independents" that we thought was implied by the change of name introduced under this Bill. I beg to move.

Lord Beaumont of Whitley: I venture no opinion on the first subsection of this amendment, but I believe that the second subsection is probably inappropriate. Many of the territories that we are considering are, at the moment, either in the course of, or are about to be in the course of reconsidering their constitutions. I believe that it is inapposite that the governor of a territory should have a final decision from which there is no appeal. In the event of the rest of this amendment being accepted, any decision as to who has the final decision should await the determination of proper constitutional arrangements for all territories.

Baroness Young: I hope that this is an amendment that the noble Baroness, Lady Amos, may feel able to accept. It may not be absolutely correctly drafted, but I believe that it would be inappropriate in a Bill such as this not to have a procedure for dealing with disputed cases, and inevitably there will be some. How that should be dealt with and what the mechanism should be is a matter for decision, but I hope that the noble Baroness will accept the principle of the amendment and, if necessary, return with an amendment appropriately drafted.

Lord Hylton: I cannot agree with the wording of this amendment. I want to support the noble Lord, Lord Beaumont of Whitley. If there is a genuine dispute, such a matter should be settled by a court. It would be a mistake to put such a decision into the hands of the head of the executive.

Lord Rooker: This amendment is an attempt to put something on the face of the Bill. It reads:
	"In the event of a dispute over an individual's claim to British citizenship",
	and so on, the final decision shall be taken by,
	"the Governor of the territory concerned".
	That would be quite outrageous, for reasons that I shall explain.
	The objective of the amendment--it is seductive--is to put in place a mechanism for dispute settlement. Such a mechanism already exists. Unsuccessful applications for passports or registration can be challenged at judicial review. Where a certificate of entitlement has been applied for, there is a right of appeal under the immigration legislation to an adjudicator and thence, in appropriate cases, to the Immigration Appeal Tribunal and the Court of Appeal or Court of Session.
	We have made clear in comment on earlier suggested amendments that discretion on disputes about British citizenship rests with the Secretary of State and not the governor of a territory. The matter has to rest with British Ministers who are answerable to Parliament. Therefore it follows that we cannot accept an amendment the effect of which would be to leave a final decision on disputed applications for British citizenship or claims to governors of territories.
	Nor do we want to disturb the present arrangement that discretionary decisions under the British Nationality Acts cannot be challenged on their merits. The judgments that have been made in those cases, relating to such matters as character, associations and future intentions, are essentially subjective.
	Every time when speaking as a Minister in the past I have had to say that there is a problem in regard to resources. In this case the problem of resources would mean that the costs of servicing a tribunal would add to the cost to be paid by the applicant. That is not the reason for not accepting this amendment. I ask the noble Baroness to withdraw the amendment due to the points that have been made from various sides of the Committee. It would be invidious to leave a decision on British nationality and British passports to a governor of a territory. Therefore, with that explanation I hope that the noble Baroness will withdraw the amendment.

Baroness Rawlings: I thank noble Lords for contributing to this short debate and the Minister for his explanation. We still feel that this Bill and most of these amendments have turned on semantics and the complication--as I said at the beginning--of not being able to acquire a clear understanding of the difference between "residence", "right of abode", "citizenship" and "passport holder". At later stages, on Report and at Third Reading, I hope that we shall be able to finalise those matters. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	Schedule 1 agreed to.
	Schedule 2 agreed to.
	House resumed: Bill reported without amendment.

Travel Concessions (Eligibility) Bill [H.L.]

Lord Falconer of Thoroton: My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
	Moved, That the House do now resolve itself into Committee.--(Lord Falconer of Thoroton.)

On Question, Motion agreed to.
	House in Committee accordingly.
	[THE DEPUTY CHAIRMAN OF COMMITTEES (Lord Brabazon of Tara) in the Chair.]
	Clause 1 [Eligibility for travel concessions: age]:

Baroness Hanham: moved Amendment No. 1:
	Page 2, line 3, at end insert--
	"(6) The appropriate Minister may by Order apply the provisions of this Act to any other age related travel concession related to public passenger transport services.
	(7) Any order under subsection (6) shall be laid before Parliament and approved by resolution of each House."

Baroness Hanham: This Bill has only two clauses and may therefore not detain us too long. Because of its genesis, it cannot be too contentious. The intention of the Bill is to extend the provisions of the various concessionary fares schemes that have existed in some shape or form since 1995, when the legislation to make legal the activities of local authorities which had already embarked on providing concessionary fares was passed.
	As my noble friend Lord Dixon-Smith reminded the House at Second Reading, the complexity of the various concessionary fare schemes arose because at that stage they were, for the most part, discretionary. Now, of course, as a result of the Transport Act 2000, there are statutory requirements to be fulfilled, and the result of this Bill before us today will be to extend all the provisions to men of 60, thus bringing everyone over the age of 60 into its scope, before it then moves the entitlement for both men and women to 65 by 2010.
	For those who live in the city, and where there are good or at least adequate transport services, this universal provision will be of enormous benefit. But what of those who live in rural areas, where bus services are often less than adequate and where the only possible means of moving about is the car? These new provisions will not help them, particularly those men who are still working, who, if they lived in areas better served by public transport, would be entitled to reduced or free fares and who, as a result, would not benefit much from the scheme. How are they to benefit from the concessions if they cannot travel by public transport because there is none? That is one of the conundrums raised by the extension of the provisions, brought about by a general lack of infrastructure in rural areas, concerns about which have been raised many times in other debates in this House.
	Those who live in rural areas and qualify for concessionary fares, but find themselves unable to take advantage of them, might be assisted by their local authorities providing alternative support, such as petrol vouchers, which could be given under certain circumstances within the terms of the concessionary fare scheme. There may indeed be other options for ensuring that everyone of eligible age can take advantage of the benefit to which they have now become, or will become, entitled. This amendment would enable local authorities to table any such proposals for consideration by the Minister and ultimate endorsement by Parliament.

Baroness Scott of Needham Market: I am very grateful to the noble Lords who have tabled this amendment. I am afraid that I failed to get my amendments on this subject past the vigilant eyes of the Clerk. It is my opinion that we should use this opportunity to reconsider the question of concessionary fares for young people--an issue that I raised during the passage of the Transport Act and also at Second Reading of this Bill.
	Of course, some local authorities already provide concessionary fare schemes for young people. Sadly, however, they are few and far between. They are located mostly in urban areas, although Derbyshire is a notable exception. The schemes work very well but, of course, local authorities are limited in their expenditure on such schemes, which means that they are unable to spend money on other forms of transport activity, or indeed other areas of their budget. Noble Lords would do well to consider the patchwork nature of the provision that exists for young people, and I hope the Government will address that issue.
	It was precisely to avoid that sort of patchwork provision for older people that the Government brought in the concessionary fares scheme under the Transport Act. In my opinion, it would be appropriate to consider whether it would also be sensible to make such provision for younger people. I shall not rehearse the arguments that I put forward at Second Reading. In brief, they concern the issues of road safety; sustainability; encouraging young people to use alternative modes of transport to cars; and accessibility to services.
	However, there is a wider issue that I should like to explore. At present there are significant structural problems in the bus industry. The proposed and expected benefits of deregulation in the 1980s have not materialised. What has happened is that the ownership of bus companies has become concentrated into very few hands. A few operators run smaller services, but they are diminishing all the time.
	In addition, public money, which goes into the bus industry, goes largely to the operators on the basis of running buses, rather than containing passengers. Public money goes in through rural bus grant, local authority support grant and fuel duty rebate. In all those cases, the bus companies have an interest in running buses; they do not have an interest in carrying passengers. When we put those things together, we find that we have ended up with a bus industry which, it is fair to say, is not as passenger focused as it might be.
	An interesting issue to consider with regard to using public money for concessionary fares purposes is that public money is spent only when people use the buses and we see all the benefits to the public good that accrue from that. We should be considering whether it would be a more sensible use of public money to extend the concessionary fares scheme, which is a subsidy to the passengers rather than the operators. I hope that over the summer there will be an opportunity to consider that issue, along with the more deep-rooted structural problems in the bus industry.
	I should have liked to table amendments that would create a truly national scheme, rather than continuing with the fragmented local authority schemes. That, too, was ruled out of order--perhaps I should speak to the noble Lady, Baroness Hanham, about tabling acceptable amendments. Nevertheless, such a scheme is another issue that I hope the Government will take time to consider during the recess.

Lord Swinfen: Like the noble Baroness, Lady Scott, I tried to table amendments to produce a national scheme, but I was ruled out of order. I was told that the Bill was only a small one, aimed at equalising ages. However, my name has been added in support of the amendment.
	I am advised that the Local Government Association agrees with the amendment, as it appears to be a good method of accommodating the association's interest in the possible extension of a statutory scheme to cover young persons in education.
	Turning to the other end of the scale, I have been briefed on the amendment by the Federation of Post Office and BT Pensioners. We have moved from the very young to the very elderly--a group which I am rapidly approaching, although I shall never be a BT or Post Office pensioner. The federation hopes that the Government will put forward clear proposals for a further extension of eligibility for travel concessions, to include national public transport journeys. That would represent the clearest signal of the regard that the Government have for older people, especially those with limited financial means.
	On Wednesday 4th July, Mr Bob Blizzard who is the Member for Waveney asked the Prime Minister about the Government's plans to extend concessionary travel for pensioners. The Prime Minister replied:
	"We are going to extend it so that it will also be available for long coach journeys. ... It is all part of making sure that they [pensioners] get the security and the dignity that they need in old age".--[Official Report, Commons, 4/7/01; col.259.]
	However, there are no such proposals in the Bill. It does not seem to have followed the Prime Minister's wishes. The current system of local concessions should be extended to include national and through routes. Many pensioners and disabled people have to cross local boundaries when they visit relatives, go to hospital or even see their GP. To be limited to only their own local authority area is ridiculous. The opportunity should be taken to accept the amendment so that the Government can introduce a nation-wide scheme. I should like the scheme to be extended to railways as well as buses.

Lord Bradshaw: I rise to take up a point made by the noble Baroness, Lady Hanham, who suggested that country dwellers will not benefit from concessions to bus users. I came to the station this morning on a country bus, which is run under the rural bus subsidy scheme, as did about a dozen other people from the place where I live.
	Many people living in rural areas use and depend on buses. I have heard it said that bus travel is not of interest to rural dwellers who all use cars, but that is not true. I urge the Government to do everything they can, not only in this Bill but in other legislation during this Parliament, to assist the bus industry and its users. We are talking today about bus users, rather than the bus industry.
	I reiterate one point made by my noble friend Lady Scott. The bus industry is in a great deal of trouble. Fuel costs are rising. Wage costs are also rising considerably because people do not want to drive buses. Bus driving is an unsocial and unpleasant job which entails contending with both traffic congestion and passengers. Passengers attack drivers when buses are late because there is no one else to blame. Finally, insurance costs in the industry have risen by 35 per cent this year, as we move more and more into a situation where people use any slight accident as a platform from which to launch a substantial claim.
	We on these Benches are most anxious that travel concessions are extended to people in the country as well as the town. We also implore the Government to examine closely the economics of the bus industry, because the money that they devote to rural bus grants and local authorities to support the bus industry through the rate support grant is being eroded as quickly as it is being applied.

Lord Berkeley: I cannot support this amendment which widens the debate far beyond what I believe to be the scope of the Bill. It is slightly ironic that the Official Opposition suggest that the problems of country buses can be ameliorated by giving people over 60 petrol vouchers. After all, it was the Conservative Party which wrecked country bus services many years ago. It is good that it now recognises that fact.
	I do not believe that the solution is to provide petrol vouchers to older people, who should probably not be encouraged to drive for very long. I speak as someone who is over 60. I believe that I am quite capable of driving, but it is clear that older people have more accidents. There must be other ways to encourage people who are able to receive these benefits to take advantage of adequately funded basic provision of public transport, whether it is taxis or something else. I oppose the idea of petrol vouchers.
	Similarly, for young people the position is fairly chaotic. There is a variation in support between different local authorities. Certainly, children in Oxford become adults at seven o'clock every night and must pay full fare for no particular reason. Perhaps they enjoy themselves after seven o'clock but not before, but the logic escapes me. I hope that the Government will consider the introduction of much more comprehensive legislation to put right some of the problems of buses.
	In conclusion, the noble Lord, Lord Swinfen, suggested that these concessions should be extended to rail. I believe that they are already extended to rail. As I am over 60 I can obtain a senior citizen's railcard which entitles me to one third off virtually every train fare. I believe that that is an extremely good concession.

Lord Falconer of Thoroton: I read the amendment moved by the noble Baroness, Lady Hanham, in the same way as the noble Lord, Lord Swinfen, and the noble Baroness, Lady Scott; namely, it aims to give power to extend the concession to different age groups. They both spoke to the proposition that it should be given to young people. That is incredibly attractive but, as both the noble Lord and the noble Baroness are aware, there is a problem of money. Such an extension would cost approximately £180 million. Therefore, although it is tempting we do not believe that that is the right thing to do.
	The noble Baroness and the noble Lord are aware that in effect this Bill sets minimum requirements for local authority travel concession schemes. The delivery of those minimum requirements will be funded by central government through the revenue support grant. If there is to be anything on top of that it must be provided by local authorities. As the noble Baroness and the noble Lord are aware, local authorities in London already have discretionary powers under the Transport Act 1985 to extend concessionary travel on public transport services to young people in this age group based on individual authorities' judgment of local needs and financial circumstances. Therefore, whether to extend the concession is a judgment to be made by local authorities.
	Further, separately my department is working closely with the Department for Education and Skills in developing a Connexions Card which offers a range of commercial discounts for young people in full-time education and is capable of carrying existing travel concessions.
	With the greatest respect to the noble Baroness, Lady Hanham, she made a Second Reading speech about transport generally. To an extent she focused on the rural situation. Rural local authorities are entitled to give such concessions as they believe to be appropriate over and above the minimum concessions required by this and other legislation which are financed by central government. The noble Baroness made a number of broader points, which were echoed to some extent by the noble Baroness, Lady Scott, and the noble Lords, Lord Bradshaw and Lord Swinfen, about rural transport and transport generally.
	The Committee will forgive me for not wanting to be drawn into a general debate about transport because that is not what this measure is about. However, to counter the point raised by the noble Baroness, Lady Hanham, about rural bus services, we have a number of initiatives in place to improve bus provision; for example, rural bus grants, quality partnerships and the Rural Bus Challenge. These measures underline the importance we attach to bus services. We are keen for additional provision to be provided, particularly in rural areas.
	The noble Lord, Lord Swinfen, and the noble Baroness, Lady Scott, said that they would like a national scheme if that was possible. We think that there should be minimum levels of concessions given to local authorities. They should decide what provision there should be over and above that level. The "to go anywhere" schemes are attractive. They could be dealt with by agreement between local authorities. We are looking at this issue with the bus industry. I am obviously not in a position to make any promise in relation to that today.
	Finally, there was a reference by the noble Lord, Lord Swinfen, to an Answer given about the coach issue in another place by my right honourable friend the Prime Minister. The matter was also raised by the noble Lord, Lord Bradshaw. The issue is that of coaches not being run by local authorities and not covering that area. Plainly, if a local authority service runs the coaches, that would be covered by the Bill. We are talking to the coach industry about the issue. Our intention is to extend fuel duty rebates to operators of long distance scheduled coach services in return for their offering half price fares to pensioners and disabled people. We are trying to make progress in relation to that.
	I hope that I have answered all the questions raised. I should mention one other point. Changes in eligibility which could be considered desirable in the future in relation to concessionary fares can be achieved by secondary legislation under Sections 147 and 151 of the Transport Act 2000. In the light of the answers that I have given, I hope that the noble Baroness feels minded to withdraw the amendment.

Baroness Hanham: I am grateful for the Minister's response. The noble and learned Lord has given me credit for throwing the issue much wider than the words did. However, I am delighted that the amendment has given an opportunity for the Committee to have yet a further debate on the possibility of extending the concessionary fares scheme.
	I tried to confine my remarks to my concern about anyone who was entitled to the benefit being disenfranchised from getting it; namely, those who might try to travel on rural buses which did not exist. None the less, the matter has had a pretty good airing for now. We may return to it later. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	Clause 1 agreed to.

Earl Attlee: moved Amendment No. 2:
	After Clause 1, insert the following new clause--
	"TAX STATUS
	Changes made under section 1 above shall not affect the tax status of any person becoming eligible to receive travel concessions in consequence of those changes."

Earl Attlee: Amendment No. 2 ensures that any person who may now become eligible for travel concessions is not inadvertently penalised under our tax laws. As my noble friend Lord Swinfen explained at Second Reading, the new concession could be seen as a taxable benefit. This could have unintended effects for men aged 60 to 64.
	The purpose of the Bill is to equalise the age at which men and women become entitled to travel concessions and to end discrimination in granting concessions based on age. However, if the concession was taxed, working men would still be at a disadvantage and the overall purpose of the Bill would not be achieved. Presumably, the Government do not want to discourage men who are working from making use of the concessions now to be given to them. I beg to move.

Lord Swinfen: I support the amendment. At Second Reading I asked the noble and learned Lord the Minister a question:
	"I wonder whether the tax authorities will consider this to be a benefit in kind and that such men will have to pay tax on it. Can the Minister assure the House that that will not be the case until such time as the pension age is equalised and men and women retired at the same time?".--[Official Report, 9/7/01; col. 945.]
	The noble and learned Lord answered a good many questions in his winding-up speech at the end of the debate, but he did not answer that one. I nearly got up to ask him to do so. However, he has now had time to think, to find out the answer for himself and to discuss it with other members of the Government. Perhaps he would now be kind enough to answer that question.

Lord Falconer of Thoroton: Finding the answer for myself might be to overstate the point, but I have now received clear advice as regards the position. I can assure the noble Lord and the Committee that travel concessions are not chargeable to income tax. I quite understand why this came to the mind of the noble Lord when we considered it on Second Reading. As a result of the Bill, people will be able to take advantage of the new concession before they reach retirement age. The noble Lord has made clear his concern that this concession might be considered to be a taxable benefit, but a tax charge of this nature could arise only where a benefit is provided by reason of the employment. I cite, for example, an employer who provides goods or services for his employee's private use, such as hotel accommodation, holidays or work carried out at the employee's residence. Travel concessions in the context of the Bill and the legislation which it seeks to amend are available to eligible people regardless of whether they are employed, self employed or do not work. The question of tax liability does not arise.
	I should point out to the noble Lord that a number of women aged over 60 and men aged over 65 who are still in work already take advantage of their travel concession to reach their place of employment without any tax charge arising. I hope that this assurance will set the noble Lord's mind at rest.

Lord Swinfen: I am grateful to the noble and learned Lord for taking the trouble to prepare what is in fact a full answer to my question. I thank him for that, even though it has taken him around a fortnight to produce it.

Baroness Hamwee: Before the noble Earl rises to speak, perhaps I may ask the noble and learned Lord whether that answer has come from the Government as a whole; namely, does it represent the view of the Treasury as well as the Minister's own department?

Lord Falconer of Thoroton: The noble Baroness is well aware that every answer I give is a response made on behalf of the Government as a whole.

Earl Attlee: I am grateful to the Minister for his reply, but I hope that we do not encounter an over-enthusiastic tax inspector. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	Clause 2 [Commencement and transitional provision]:

Baroness Scott of Needham Market: moved Amendment No. 3:
	Page 2, line 5, after "Minister" insert "(after consultation with representatives of local authorities)"

Baroness Scott of Needham Market: I beg to move Amendment No. 3 tabled in my name and that of my noble friend. At present, local authorities are still dealing with the impact of the half-fare scheme which was brought in under the terms of the Transport Act 2000. During the passage of that Bill, a number of concerns were raised by local authorities which were then reflected in our debates in this Chamber. Those concerns sought to confirm whether the moneys being made available by the Government would be sufficient to meet the costs. I think that it is fair to say that the then Minister, the noble Lord, Lord Whitty, understood those concerns. He gave an assurance that the costs would be monitored to ensure that local authorities were not severely damaged by having to fund the concessions.
	However, I have to say that I was not entirely convinced by the Minister's reply in the debate on Second Reading. I did not understand exactly how the review mechanism would work. The mechanism is important in its own right, but the Bill will make it even more important. The provisions add not only a further group of people to those already entitled to take up the half-fare scheme, they also extend the eligibility to concessions on rail fares and so forth, where such schemes apply in local authority areas. Thus a significant cost to local authorities must be considered here.
	In the debate on Second Reading, the Minister indicated that local authorities would be compensated when they bid for funds. Unfortunately the situation is not as simple as that because rate support grant contains an element entitled "new burdens" which is issued in one large block. That element is difficult to disaggregate even across local authorities in general. As a result, it is almost impossible to decide which local authorities will suffer more disadvantage than others. The perceived danger here--indications show that it is well founded--is that those authorities which in the past offered more generous schemes are now losing out because they did so. That is not equitable.
	This amendment and, I imagine, the other amendments tabled in the grouping, is designed to ensure that a proper dialogue takes place with the Local Government Association and the Association of London Government to ensure that the mechanism for recompense is suitable. It would be useful if the Minister could take the opportunity presented by the Summer Recess to consider whether a more appropriate mechanism for recompense might be a time-limited specific compensation scheme which could be targeted at individual local authorities rather than using the somewhat blunt instrument of the rate support grant. I beg to move.

Baroness Hanham: My Amendments Nos. 4 and 5 are grouped with the amendment we are discussing. I support what has been said. As we said before, the purpose of the Bill is to equalise the age of the travel concession benefit. Therefore, it is extremely important that local authorities are compensated adequately for the costs of introducing the concessions for men aged 60 to 64, as for the other groups already eligible.
	As I understand it, there is as yet no agreement between the Government and the local authority associations as regards the extra costs associated with the changes. Indeed, I am not yet aware that there has been any agreement on those associated with the provisions in the Transport Act 2000, never mind the extensions proposed in the Bill. It is incumbent upon this Chamber to ensure that the additional costs are carefully considered before there is any suggestion of the Bill's provisions being implemented; otherwise, those provisions, or those that we are considering, could be jeopardised and/or could result in cuts in the provision of concessionary fares for groups such as the blind and the disabled as well as older people.
	The risks of inadequately funding local authorities can be demonstrated already by what is happening in some local authority areas where it has been reported to me that concessionary fares have been cut to the 50 per cent statutory minimum even before the implications of this Bill have been considered. The Royal National Institute for the Blind has particularly drawn my attention to its concern that such reductions would have a disproportionately serious effect on its members.
	At Second Reading I drew attention to the position in London where there is a 100 per cent free fare scheme--not only on the statutory but also on the wide discretionary basis--which covers many other categories of recipient. The anticipated extra cost is some £25 million which is well in excess of the £16 million which has been suggested and half the total estimated for the whole additional expenditure. That is brought about because of the complexity of the compensation arrangements between the boroughs and Transport for London. If compensation to London were to be provided on the basis of a half fare on buses only--as has already happened with the Transport Act 2000--there would be significant extra costs to be borne by the London boroughs. I am a member of one of those boroughs. There is a danger that without proper compensation the scheme could, in some areas, have to be reduced.
	The amendments in my name and that of the noble Baroness, Lady Scott, will, I hope, enable the Minister to reassure the Committee that these matters are already the subject of discussions between the department and the local authority associations. But whether or not that is the situation, I hope that he will accept the amendment so that both those who expect to benefit fully from the provisions in the Bill, and those who will have to pick up the tab, can be reassured that the provisions will not be introduced without proper financial compensation being agreed.

Lord Monson: I did not take part in the Second Reading debate on the Bill because another, more compelling, matter intervened, notably the titanic struggle between Ivanisevic and Rafter!
	In rising to give my broad support to this group of amendments, I make a general observation on the Bill. I value enormously my London Transport pass. It is extremely helpful to me and in a small way it is helpful to the bus operating companies in so far as the driver of a one man operated bus spends much less time at bus stops if he or she merely has to glance at a pass rather than accepting coins and notes and dispensing change. Nevertheless, I cannot help feeling a trifle uneasy that I, and everyone in my position--like many in this Chamber--are being subsidised by those under the age of 65, and shortly by the rather smaller group of people under 60.
	That blanket approach might have made good sense 50 or 60 years ago when the overwhelming majority of men and women over 60 were, indeed, much poorer than the population as a whole. But is that so today when although there are, of course, unfortunately, large numbers of poor elderly people, there are also a great many extremely wealthy ones, largely, although not entirely, due to the rise in house prices well in excess of inflation? I suspect that 90 to 95 per cent of the passengers on a round-the-world cruise where the cabins cost £25,000 or so will be over 60. So I wonder whether perhaps a little more targeting may have been justified in this case. Having made those points, I shall sit down.

Lord Falconer of Thoroton: These amendments concern the funding issues in relation to the concession. We accept that the funding for delivering the increased concession--which means extending it to men between the ages of 60 and 65, which is not the present position--will cost money. That money will come from central government. A process will need to be developed whereby, properly, the amounts of that extra cost can be assessed between central government and local government. I made it clear at Second Reading--I make it clear again--that that is the objective that central government and local government must work towards in trying to reach a solution in relation to the funding. It will be done through the revenue support grant. It would not be appropriate for there to be separate compensation schemes.
	My relationship with local government has become more intense since 7th June, when I became the Minister for housing, planning, urban renewal and urban regeneration. That relationship indicates that local government is averse to specific pots of money being put in--and I am very happy to see many Members who serve in local government and to hear a loud noise of approval in relation to that--whereas some of these amendments appear to flirt with "compensation schemes", which is another way of saying some kind of ring fencing.
	Let me now deal with the individual amendments against that background. Amendment No. 3 requires the Secretary of State or the National Assembly for Wales to consult with the local authority associations before bringing the Act into force. I can reassure the movers of that amendment that my department and, in Wales, officials of the National Assembly will of course be in touch with the local authority associations about commencement and implementation through the normal course of business. Furthermore, as I shall explain in a moment, the local authority associations are a vital part of the discussions which surround the local government finance settlement. In the light of the assurance that I have given, I suggest that that amendment is not necessary.
	The effect of Amendment No. 4 would be to hold the Government to ransom, preventing the Act being brought into force in London until agreements are made with the local authority associations regarding the level of funding. This could potentially delay the benefits of this legislation being enjoyed by men aged 60 to 65 living in the London area. I do not know whether or not that was the intention of the noble Baroness in moving the amendment, but that is its effect. I respectfully ask the noble Baroness to reconsider that amendment and not to move it.
	So far as concerns Amendment No. 5, a compensation scheme is not necessary. I do not think that the noble Baroness is really suggesting that local authorities should receive funding for the extended eligibility through their revenue support grant allocation in the usual way, and also receive compensation. I assume that she is suggesting them as alternatives in that respect.
	I suggest that Amendments Nos. 4 and 5 are not needed. I can assure the Committee, as has been mentioned by the noble Baroness, Lady Scott, that we are committed to the "new burdens" principle. This requires us to reimburse local authorities for the extra costs they face. We shall be working with the local authority associations as we finalise our estimates of the financial implications for councils.
	The noble Baroness, Lady Hanham, again made the point that she made at Second Reading that it is a 100 per cent concession, what are we going to do about it? The Association of London Government is very much involved in the usual revenue support grant allocation discussions with my department and in discussions on the Spending Review--as are all local authority associations--and it will no doubt be making many of the points made by the noble Baroness in the course of those discussions. But there is absolutely no harm in paving the way by making the points now. Any extra provision needed for men aged 60 to 65 will be included in the annual local government settlement. That seems to be at the very heart of the issue.
	Let me reassure the Committee that the local authority associations will be consulted on our proposals for the local government settlement and that we will listen carefully to the points that they make, alongside all other representations, before taking final decisions.
	The noble Baroness, Lady Scott, raised the question of monitoring, to which my noble friend Lord Whitty referred. I believe that that was in the context of saying that it is quite difficult to work out how many more people will be using the concession, because working men between 60 and 65 may use it more than men who are retired. There needs to be detailed discussion about how its use can be monitored. The bus companies will want to monitor it as much as everyone else, and that should form part of the discussions that take place between central and local government.
	I hope that in the light of the reassurances that I have given, the noble Baroness will feel able to withdraw her amendment and that it will not be found necessary to move the other two amendments.

Baroness Scott of Needham Market: I thank the Minister for his reassuring words. With the single caveat that I hope the Minister's understanding of "consultation" is the same as mine--in other words, that it will mean a proper dialogue with local government--I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Hanham: had given notice of her intention to move Amendment No. 4:
	Page 2, line 10, at end insert ", and
	(c) not be made until there is agreement with the relevant local government associations concerning the funding provision for the scheme in the annual Revenue Support Grant negotiations."

Baroness Hanham: The Minister has conjured up the delicious possibility of my being able to hold the Government to ransom. What could be a better parting of the ways for the Summer Recess than holding a pistol to the Government's head?
	I am grateful to the Minister for his comments on the amendment. I heard clearly what he said about consultation. It is important to bear in mind that there is presently a "mismatch" as regards expectations of cost. Therefore, consultation will need to take place to ensure that London in particular is properly compensated for the costs of the scheme. In the light of the Minister's remarks, I shall not move the amendment.

[Amendment No. 4 not moved.]
	[Amendment No. 5 not moved.]
	Clause 2 agreed to.
	Clause 3 agreed to.
	House resumed: Bill reported without amendment.

National Minimum Wage Regulations 1999 (Amendment) (No. 2) Regulations  2001

Lord Sainsbury of Turville: rose to move, That the draft regulations laid before the House on 5th July be approved [2nd Report from the Joint Committee].

Lord Sainsbury of Turville: My Lords, I am pleased to present these amending regulations to your Lordships. They are primarily about increasing the main rate, and the development rate, of the national minimum wage.
	The national minimum wage is an outstanding success. It is now very widely recognised that it was sensibly introduced and effectively implemented, and that it is helping all those it was designed to help without causing any significant problems to the economy.
	The independent Low Pay Commission has a key role to play in this policy. The Low Pay Commission not only makes unanimous recommendations on rate increases and other changes to the regulations as appropriate; it also monitors the impact of the policy so far by looking at the official data and also, crucially, by talking to the small businesses and other employers, the workers, the sectors, the advice groups and so on who are in the front line. It has found none of the dire consequences predicted by opponents of the minimum wage. Indeed, its success has now converted all but the most blinkered critics into supporters of this policy, though with varying degrees of enthusiasm.
	The Low Pay Commission submitted its report this year in two volumes. In March, it presented us with Volume One, which contained the recommendation to increase the main rate to £4.10 an hour from the current £3.70 an hour. That report also contained a great deal of very interesting evidence and findings about how the minimum wage had impacted on the country so far. It is comprehensive and it challenges many of the assumptions that have been made about the effects of legislating in this particular part of the labour market. Above all, Volume One found that,
	"results from research ... show that the effect of the minimum wage on employment was broadly neutral or, if anything, mildly positive".
	So much for the collapse of the economy and the predictions of millions of job losses.
	I repeated a Statement in this place on 5th March of this year about the main rate increase from £3.70 an hour to £4.10 an hour. We now have the regulations before the House. I should like to say a few more words on the subject.
	The first point to note is that, like all its reports and recommendations, this was unanimously agreed by the members of the Low Pay Commission, which includes a small business person, the Deputy Director-General of the CBI and one other business person, as well as academic experts and leading trade unionists. This was a balanced recommendation based on factual analysis and the consultations and evidence gathered over the preceding year. A rise to £4.10 represents an increase of 5.4 per cent a year over the period of two-and-a-half-years since the introduction of the minimum wage in April 1999. It is roughly in line with rises in average earnings over that period.
	In our Regulatory Impact Assessment, the Government noted that,
	"whilst its impact on the overall wage bill of employers will be small, the rise will be of significant benefit to workers on low incomes, especially those who are paid at the prevailing minimum wage rate".
	Or, as the Low Pay Commission put it:
	"We believe we have recommended an increase ... which will be manageable by low-paying sectors, but will still provide low-paid workers with a substantial rise in their hourly earnings".
	The Low Pay Commission submitted Volume Two of its third report at the start of June. This volume covers the development rate for younger workers and for adult workers who are receiving training at the start of their jobs. It looks at the age at which the main, adult rate should apply. It looks at the future role of the LPC itself. It also covers quite a number of other detailed issues around implementation and coverage.
	The LPC recommended that the development rate should rise from £3.20 an hour to £3.50 an hour on 1st October, and the Government agreed. The regulations that we are considering here today effect that change. This represents an increase of around 6.7 per cent a year since April 1999-- slightly higher as a percentage than the main rate because the initial rate was lower than the £3.20 recommended by the LPC in its first report.
	One of the most welcome findings in the LPC report was that the rise in employment levels of young workers was actually greater than the average rise in employment across all ages. That is a significant finding. It supports our case for having a lower rate for young workers. International studies have shown that countries that apply a single rate to all workers aged 18 or over can sometimes experience problems with worsening youth unemployment among the unskilled. However, I know that this is a sensitive issue. The LPC indicated that it would like to keep the whole question of age coverage under review. The Government have accepted that recommendation. We do not want to take risks with young people's jobs. Our success in getting young people back to work is one of our proudest achievements. We want to do nothing that might jeopardise that.
	Perhaps I may say a few words about the sectors that are likely to be most affected by the rate increases; namely, sectors such as hospitality and social care. The LPC is well aware of the sectors where low pay is a particular problem. Its reports have looked into those areas in great detail, both in terms of the effects so far and the likely effects of the rise in October. The commission found that some sectors would, of course, be more affected than others. It also found particular issues in respect of care homes that we are following up with relevant government departments, because they link into the whole question of the provision and funding of social care.
	But, overall, the Low Pay Commission concluded that there was no reason why the same positive response that it had found from most companies in 1999 on the introduction of the national minimum wage should not also be found in 2001, with this increase. Perhaps I may reiterate that the increase restores the original value of the national minimum wage; it is not "inflation-busting". It will cover roughly the same number of workers--1.5 million--as the £3.60 did in 1999.
	So far, I have refrained from quoting lists of figures from the LPC report, but I should now like to do so in order to explain what we mean when we talk about a "positive response" from businesses. The following facts come from Appendix 2, Volume One, of the third report of the Low Pay Commission which gives the result of the LPC's own survey of firms--mostly small firms--in low paying sectors. Almost a third of respondents that were affected by the national minimum wage said that they had benefited from it. Higher staff motivation was the most common benefit. One third of childcare business, for example, had seen increases in motivation. Other benefits included lower staff turnover, the faster filling of vacancies and increased productivity.
	Increasing productivity does not mean laying off workers or lengthening hours. About one third of businesses said that they had responded by increasing their investment in training and development. About the same proportion reported an improved quality of service.
	However, we are not complacent. It is only fair to point out that some respondents also reported increases in prices or reductions in profits. Our task now is to ensure that businesses respond in a positive rather than a negative way to the new national minimum wage rate.
	Two other changes are brought about by the regulations. First, and in line with another recommendation of the Low Pay Commission, we are proposing to increase the maximum allowable offset for accommodation. This will go up in line with the rate increases.
	The Low Pay Commission has recommended that these maximum amounts increase to £3.25 a day, or 57p an hour, up to a maximum of £22.75 a week. This is in line with the increases to the rates and therefore preserves the real value of the offset. We know that some particular business lobbies have called for a much higher maximum offset to reflect the real market value of the accommodation provided. But there are real difficulties with trying to make an accommodation offset represent a real cost or value.
	First, on a point of principle, we want the majority of the minimum wage to be paid in money, not as a benefit in kind. And on a practical point, there is no way of establishing the "right" rate in market terms. Rents vary enormously from region to region and even from month to month. What is "the right rate" for hotel workers in central London, for gamekeepers in the Highlands of Scotland, for waiters in a bar in Blackpool? That is why we agree with the Low Pay Commission that the accommodation offset should remain a token recognition of the value of accommodation which can be applied universally to all sectors and regions.
	Secondly, the regulations change the definition of "accredited training" to reflect changes to legislation on education and skills. This is a bit of "good housekeeping" and does not affect policy. In brief, the development rate can be applied to adults in the first six months of their new job, provided that the employer can show he is receiving accredited training in that period.
	The original regulations defined accredited training as being any course which was listed in Schedule 2(a) of the Further and Higher Education Act 1992. That Act has now been repealed and replaced by the Learning and Skills Act 2000. The amending regulations therefore refer to Sections 97, 98 and 99 of that Act, but we have kept in a reference to Schedule 2 of the now repealed Act, too, to ensure that nothing falls between the gaps in the transitional period before those sections of the new Act are brought into force.
	All these changes come into force on the same day--1st October this year. I have no hesitation whatever in commending these regulations to the House and I am confident that they will enjoy the support of all Members. I truly believe that the way the minimum wage has been introduced and maintained is an example of consultative policy-making at its best and I urge the House to support the rate increases and other changes. I beg to move.

Moved, That the draft regulations laid before the House on 5th July be approved. [2nd Report from the Joint Committee].--(Lord Sainsbury of Turville.)

Lord Astor of Hever: My Lords, I am grateful to the Minister for explaining these regulations in great detail. Having opposed the introduction of the national minimum wage for reasons which we considered valid at the time, we naturally accept them as a fact. We are pleased that our predictions about their effect on unemployment have not yet come to pass. That is not to say that they never will. It all depends on the state of the economy. At the moment, the economy continues to do well under the momentum that the previous Conservative government provided. With the economy strong in most areas, employment has continued to do well with it. The real test will come if, as is predicted, the economy turns down and the Chancellor suffers together with the rest of us from a bust. Then it will be seen what effect the national minimum wage has on the vulnerable low-paid sector of employment.
	With that caveat, we accept the regulations and will not oppose their passage.

Lord Razzall: My Lords, perhaps I may add to the remarks made by the noble Lord, Lord Astor of Hever. The Minister will remember that we have consistently supported the passage of the minimum wage legislation and the regulations under it as it passed through this House.
	As an aside, perhaps I may say that I had always assumed that economic activity was the result of the activities and work of the employees and workers of the country not of government. But I bow to the assumption of the previous speaker that the economy is sound because of the actions of the previous administration.
	When the Act and regulations came before the House we had reservations about two issues. The first involved whether there should be a regional variation of the minimum wage. In dialogue with the Minister in recent years, we have indicated that from these Benches we have changed our mind with regard to regional variation. We accept the position of the Government and of the Low Pay Commission that regional variation, as we originally advocated, was not a sensible policy. At the levels at which the minimum wage has been introduced, we accept that a regional variation would not be acceptable.
	I listened carefully to the Minister's remarks on a differential rate for 18 to 21 year-olds. We have significant concern about that. The experience of 18 to 21 year-olds, in particular in the catering industry in the south of England, leads one to believe that a differential rate for 18 to 21 year-olds may be unfair. If the Minister cares to attend almost any public house or restaurant south of a line from the Wash to the Bristol Channel I doubt that he will be served by anyone born in the United Kingdom. He is most likely to be served by an Australian, a South African or someone from the Balkans or the European Union. In the south of England, therefore, I do not think that there would be unemployment fears if the rate were brought into line with the adult rate.
	The Minister indicated that the Low Pay Commission wanted to keep in mind the differential rate. I hope that the Government will retain an open mind should the Low Pay Commission recommend a narrowing of the differential or its elimination.
	I have two final points, the first of which I have made previously to the Minister. In debate on the Act, we were concerned that the permanence of the Low Pay Commission should be enshrined in government thinking. I welcome confirmation from the noble Lord that the Low Pay Commission will be with us for ever. I believe that he gave that commitment previously. It is important that we have objective surveys if the minimum wage is always to be part of our life.
	With the current operation of the national minimum wage, what is the position regarding evasion? Do the Government have statistics on the extent to which employers of the wrong kind are evading the regulations? To what extent is that regarded as a problem?

Lord Lea of Crondall: My Lords, in welcoming the regulations perhaps I may ask two questions. First, does the Minister agree that the introduction of the regulations on the basis of the evidence of the first year or so of implementation is a tribute to the whole process? The Government are to be congratulated, as are the social partners involved in the strategy and its implementation. It is a good demonstration of how to close the gap between Parliament and the people. It is perhaps the best example of something that the Government have done that is immediately recognised on the doorstep, along with the legislation on four weeks' holiday. Interestingly, it is also a reform of particular relevance to the most marginalised in society. We hear a lot about the marginalised in debates among the chattering classes--we have to include ourselves in that group--but this is a practical measure that is targeted, laser beam-style, at the most marginal in our society.
	It is good to hear that, albeit with some caveats, the Opposition now admit that they got it wrong, at least for a period of time. I think that period of time will continue. It is also fair to say that the Opposition are tacitly conceding that they got it wrong when they said that the whole of industry and commerce would be smothered in red tape as a result of the introduction of the minimum wage. Leading on to the question asked by the noble Lord, Lord Razzall, does my noble friend agree that the national minimum wage, which is a remarkable innovation in the tradition of British industrial relations of voluntary collective bargaining, has been carried through with a light touch? The lack of regional variation also means that the figure is easily recognisable. Whatever the figure--£4, £4.10 or £4.20--it is known to everybody.
	It is also worth congratulating our friends in the Inland Revenue. Those are not words that we hear very often. The fact that no one ever hears about the Inland Revenue's enforcement department suggests that it is doing its job pretty well.
	Does the Minister agree that the figure for non-payments--it is hard to be certain about this, but one hears informal guesstimates of 200,000--should be kept under active review together with the Low Pay Commission to see whether some fine-tuning is needed in due course?

Lord Monson: My Lords, the eve of a Summer Recess is no time to start arguing with the Minister about the principle of the minimum wage, which compels employers to pay above the market rate. I shall leave that to economists associated with the Institute of Economic Affairs, though, alas, none of them seems to be present this afternoon.
	I am sure that the Minister will concede that a minimum wage is not the same as a minimum standard of living. A minimum standard of living is a highly desirable objective, but it can be achieved without introducing a minimum wage. Indeed, the latter might even lower the standard of living of certain unskilled prospective employees if it is set so high that employers no longer feel that it is worthwhile to employ them.
	The Minister has given some interesting statistics and things seem to have turned out better than expected so far, but, as was said from the Conservative Front Bench, we are in uncharted waters. The rate is going up by about 11 per cent. Things may look different a year from now, particularly as the country appears to be going into recession.
	I have no interest to declare on this point, but the least desirable aspect of the issue is the derisory allowance made for accommodation provided by the employer. The figure of £22.80 a week is probably half what it really costs an employer to provide accommodation for an employee anywhere in London or the South-East and about two thirds of what it would cost in the West Country or the North of England. I think that is an error, but there is nothing that I can do about it, so I shall simply sit down.

Lord Sainsbury of Turville: My Lords, I do not know whether the general acceptance of the regulations is due to them being very good legislation or the fact that the summer holidays start after this debate. It is encouraging that there is now such wide support for the national minimum wage.
	People will note that, even at this late stage, the Opposition are suggesting that they are not fully supportive of the measure. It is not a measure which one can support in good economic times but decide not to back in bad economic times. One must be either for or against it. I believe that people will note that, even at this point, the Opposition are not enthusiastic about this piece of legislation.
	I am glad that it is accepted by the noble Lord, Lord Razzall, that it is right to set a national level. As was said later in the debate, I believe that that is a simplifying factor which is desirable in this case. Of course, it is always open to any pub owner to pay more in order to attract workers. This is a national minimum wage, not a national minimum maximum. However, given the fact that substantial international research shows that countries which have a uniform national minimum rate have seen increases in unemployment in the 18 to 21 age range, I believe that it is right to be cautious about a national minimum wage for people aged 18 to 21.
	The Government have confirmed that the Low Pay Commission is now permanent and will be given full terms of reference in due course. There remain some problems in relation to enforcement, but they are not substantial and we shall keep them under review.
	We are, of course, always happy to accept that the success of any government scheme is due to its excellent implementation by the Government. I am also happy to agree that little red tape is involved in this measure. The cost of it to business is simply the cost of paying decent wages.
	The question of the minimum wage and the minimum standard of living is important. The report of the Low Pay Commission shows that the national minimum wage has not led to a lowering of standards. There is absolutely no evidence of that; if anything, the reverse is true. Of course, this is not the only part of our policy which deals with the problem of low standards of living; the working families' tax credit is another. Equally, there is no doubt that for many people the national minimum wage plays a key part in maintaining the minimum standard of living.
	I hope that I have explained that it is almost impossible to provide a clear economic figure for the accommodation off-set. Equally, we want the national minimum wage essentially to be paid in the form of wages rather than accommodation. That is why we have consistently accepted the report of the Low Pay Commission which states that the figure which is set cannot be said to be the clear economic figure applying across the country but is one which provides some off-setting effect for accommodation.
	I hope that I have answered all the questions that were raised. I believe that this is an excellent piece of legislation which is showing its worth. On that basis, I am very happy to commend the proposals to the House.

On Question, Motion agreed to.

Adjournment

Lord Carter: My Lords, as I rise to move the adjournment of the House, it is with great pleasure that I take the opportunity to mark the end of term with a few words of thanks, as is the usual tradition. I believe that noble Lords will agree that the period since the election has been a little more palatable than is our usual summer term. It has been punctuated by pithy Second Readings rather than late-night Committee stages. The only downside to that has meant that I have seen rather less than usual of my friends and colleagues, the noble Lords, Lord Henley and Lord Roper. This may have been an easier time for the usual channels than sometimes is the case. Nevertheless, I thank the noble Lords, Lord Henley and Lord Roper, and, indeed, the noble and gallant Lord, Lord Craig of Radley, for their patience and co-operation in organising the business of the House.
	As ever, I pay particular tribute to the staff of the House. It is of course invidious to single out individuals and we should never do so. However, we did it last week, when we marked the retirement of one of our longest-serving members of staff--Mary Villiers of Hansard. I am sure that your Lordships will allow me to break the rule again today when I say that this will be the last sitting day for someone who is known to everyone in the House. I refer, of course, to the Whips Office Special Messenger, John Bannister. I am afraid that the rules of the House do not allow me to refer to anyone standing below the Bar of the House, so I will not. John Bannister served the House and another place for a total of 28 years. He worked in the Whips' Office under this Administration and the previous administration. Noble Lords in all parts of the House who had the benefit of John's assistance will join me in thanking him for his endless good humour and reliability and in wishing him a long, happy and energetic retirement.

Noble Lords: Hear, hear.

Lord Carter: My Lords, there are many other staff in the House who serve us well; some are seen and some are unseen. It would be hopeless to try to list them all but their work is always of the highest quality and we are fortunate to be served so well.
	My prepared notes say that the pace of life "is likely to" increase when we return in the autumn; I am sure that it will. I encourage all noble Lords to make good use of the Recess. They should rest, relax and regain their strength. We will all need it when we return to the fray on 15th October. In the meantime, I wish every noble Lord and every member of staff the very best of holidays and look forward to seeing everybody in the new term.

Lord Henley: My Lords, like the noble Lord, Lord Sainsbury, I shall endeavour to be brief. I start by thanking the noble Lord the Chief Whip for everything that he said and I echo his thoughts about what we owe to the staff for all that they do for us to keep the House running. Normally at this time of year we have to thank them in particular for their hard work in May, June and July and for putting in long nights. As a result of the election we have obviously had a slightly quieter time of late but clearly we shall have a much busier time in the months following our return on 15th October.
	I say in passing how grateful I am to the Government for bringing us back when the conference season is over. That will allow us to go to Blackpool and other noble Lords to go to resorts of their own volition.
	I also echo in particular the comments that the noble Lord, Lord Carter, made about the Whips Office Special Messenger, John Bannister. John served five Chief Whips in this House: Lord Hesketh and Lord Ullswater, my noble friends Lord Denham and Lord Strathclyde and the noble Lord, Lord Carter. I speak on behalf of both sides of the House in saying that he also gave a great deal of help to several Opposition Chief Whips. I refer to myself and my noble friend Lord Strathclyde and I am sure that my thanks will be echoed by the noble Lord, Lord Graham of Edmonton, and would have been echoed by the late Lord Ponsonby of Shulbrede. All of us on the Opposition Benches echo absolutely everything that the noble Lord the Chief Whip said.
	As the noble Lord, Lord Carter, said, we are going off for a good holiday. We on these Benches will return refreshed. I hope that we will not keep the House up unduly. I imagine that the Government will do so by introducing, as they always do, excessive amounts of legislation, some of which is unnecessary and which we do not wish to see. As always, we on this side will ensure that legislation receives appropriate scrutiny and I say in advance how grateful we will be to the staff, who will have to look after both sides of the House when that excessive load has to be scrutinised.

Lord Craig of Radley: My Lords, on behalf of all Cross-Benchers I associate us with the tributes that were paid to the staff, which were well deserved. We have been well looked after throughout this period. I follow the noble Lord, Lord Carter, in thanking Mr Bannister, who has in his time also given enormous help to Cross-Benchers. The Cross-Benchers have also benefited greatly from the work of Mr Colin Preece, who is retiring as accountant. I am sure that all noble Lords will join me in wishing him well. The Cross-Benchers, too, valued very highly the efforts of the Editor of Hansard, Mary Villiers, who looked after us all extremely well.
	Eighteen new Cross-Bench Peers have joined us very rapidly. It is a tribute to the staff that they have been able to settle in so quickly--they received the enormous guidance and assistance that all new boys and girls need when they come to your Lordships' House. I wish everybody a happy Recess and look forward to returning to full throttle when we come back in October.

Baroness Harris of Richmond: My Lords, I hope that your Lordships will accept me in place of my noble friend Lord Roper. I join the Government in their good wishes to Mr Bannister and to thank him, from these Benches, for the enormous help and support that he has given to us.
	Also, I wish the staff a very happy and relaxing holiday. I thank them for all the help and support they have given to those on these Benches. It is a great pleasure to be able to do that. From the Liberal Democrat Benches, we wish everyone a happy holiday.
	House adjourned for the Summer Recess at sixteen minutes past four o'clock until Monday 15th October next.